Many Canadians target a retirement exit at 65 mainly because they will receive the average Canada Pension Plan (CPP) and maximum Old Age Security (OAS) benefit, not at reduced rates. However, the actual retirement date is always a personal choice, often dictated by financial readiness.
Retirement planners always remind future retirees to plan ahead and not to rely solely on the CPP and OAS. Both government pensions are partial replacements only for working income. To prevent financial dislocation in the sunset years, they suggest tapping into the Tax-Free Savings Account (TFSA) and Registered Retirement Savings Plan (RRSP) to fill the shortfall. Both are recognized today as retirement accounts.
A 45-year-old Canadian, for example, has 20 years to prepare until age 65. The average TFSA and RRSP balances will give insight into how effectively this demographic is using the two investment vehicles.
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Tax-advantaged
As of January 2026, the maximum lifetime contribution limit of the TFSA is $109,000. The typical TFSA at 45 or within the demographic is only $28,000 (high end), which is also below the national average of $38,566. Given this data, the unused contribution space is $81,000.
If you are in your peak earning years and have the same lump-sum amount to invest today, the compounding potential over a 20-year runway is massive. An $81,000 position in Enbridge (TSX: ENB) will grow to $217,957.50 in 2046. This large-cap stock is a compounding machine with a low-risk profile.
ENB trades at $78.70 per share and pays a 5% dividend. The $170.3 billion energy infrastructure company operates four core businesses with $10 billion to $20 billion in combined growth opportunities within the next two years. Its low-risk profile stems from the regulated or take-or-pay contracts (98% of EBITDA). The 31 consecutive years of dividend increases confirm its compounding power.
Tax-sheltered
For the RRSP, the statistical average balance for the age band 45–54 is $150,300, although the more realistic figure is $70,000, which is the median. The recommended benchmark readiness by financial planners is three to four times your annual salary. Given this data, half of all Canadians in their peak earning years have less than $70,000 in their RRSPs.
Since RRSP contributions are tax-deductible, sporadic contributions in higher income brackets mean paying more taxes and receiving a smaller refund. Unused RRSP contributions are referred to as deferred deductions in income tax returns. Ideally, you should maximize RRSP contributions in your peak earning years to significantly reduce the marginal tax rate.
Like with the TFSA, contribution limits carry over to the following year. Dividend stocks are eligible investments in an RRSP. Enbridge can be your anchor holding, too. While investments grow tax-free, the reckoning with the Canada Revenue Agency (CRA) happens when you make withdrawals. Taxes are deferred until funds are withdrawn.
Golden opportunity
The TFSA and RRSP of Canadians aged 45 are severely underutilized. Still, the unused headroom for both accounts is a golden opportunity to build wealth and ensure financial security in retirement. Regular contributions, a blue-chip compounder, and dividend reinvestment will close the gap in 20 years or less.
