FAQ: Do CPP Projections Take Future Earnings into Account?

Yes, the platform takes into account zero earning years if you choose to retire early, this gets included in the dynamic CPP calculation. These zero earning years can be a "drag" on your CPP benefit.

This gets automatically calculated when changing CPP Start Age and gets automatically calculated in the AI Strategies CPP Start Age.

To provide more detail, the platform takes your CPP Statement of Contributions, which you enter in Discovery > Tax & Benefits and pairs that with your future income assumptions in Foundation > Future Cash Flow. This allows the platform to do three things when calculating CPP:

1. It lets the platform know if there are lower earning years ahead, which can bring down avg. lifetime earnings and bring down the future CPP estimate
2. It lets the platform know if there are higher earning years ahead, which can bring up avg. lifetime earnings and bring up the future CPP estimate
3. It lets the platform calculate future CPP Enhancement benefit which can increase the future CPP estimate

CPP estimate from Service Canada can be very misleading, especially for those who will retire early, those who have future earnings higher than past earnings, and for those in their 50's and below who will have a large benefit from CPP Enhancement.