By 2025, you must earn at least $71,300 annually to maximize basic CPP contributions. This threshold is known as the Year’s Maximum Pensionable Earnings (YMPE).
So any income above this level will not increase your basic CPP benefit. However, a second tier now exists with the enhanced CPP program, as earnings between $71,300 and $81,200 provide additional contributions that contribute to a larger future retirement.
To qualify for maximum benefits at age 65, you generally need a high income for at least 39 of the 47 years between the ages of 18 and 65. The system includes a fallout provision that removes approximately eight years of your lowest income from the calculations.
This means that occasional periods of low income will not necessarily harm your eventual pension, as long as you maintain your income at YMPE level for the remaining years.
A 65-year-old who starts the CPP can receive a maximum annual basic pension of $16,645. Driven by the CPP improvement, future Canadian retirees who earn at the aforementioned income caps throughout their careers will see higher maximum payouts.
However, retirees should look to supplement their CPP payouts with other sources of income. A cheap way to start a passive income stream is to invest in quality dividend stocks like Pembina Pipeline (TSX:PPL).
Hold these top-tier dividend stocks and top up the CPP
Pembina Pipeline provides energy transportation and midstream services in North America through three main segments.
- The Pipelines segment operates conventional, oil sands and heavy oil assets with a combined capacity of three million barrels per day, plus ground storage and rail terminals.
- The Facilities segment provides infrastructure for the processing of crude oil, natural gas and natural gas liquids, including fractionation, cavern storage and a liquid propane export facility.
- The Marketing and New Ventures segment buys and sells hydrocarbon liquids and natural gas from Western Canadian and other basins.
In the third quarter (Q3) of 2025, Pembina Pipeline reported adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) of $1.034 billion, up 1% year over year. The energy infrastructure company also lowered its full-year guidance to $4.25 billion and $4.35 billion. Pembina remains on track to meet its initial 2025 targets while executing multiple strategic initiatives across its integrated value chain.
Pembina recently signed a 20-year agreement with PETRONAS for one million tons of liquefaction capacity per year, expanding its previous commitment of 1.5 million tons. The company expects to finalize contracts for the remaining 0.5 million tonnes of capacity by the end of the year.
Pembina achieved great success in the recontracting of its conventional pipeline network, signing new transportation agreements on the Peace Pipeline system for approximately 50,000 barrels per day, with a weighted average term of 10 years.
Notably, 100% of these volumes fall within areas served by competing alternatives, but Pembina maintained current contracted toll rates for virtually all volumes due to operational efficiencies and superior service offerings.
Pembina Pipeline pays shareholders an annual dividend of $2.83 per share, which translates into a forward yield of more than 5.3%. The TSX energy stock has increased its annual dividend from $1.90 per share in 2016 and is expected to increase it to $3.11 per share in 2029.
Given consensus price targets, Pembina shares are trading at a 10% discount. If we adjust dividends, the cumulative return over the next twelve months could be closer to 15%.
#maximum #CPP #Heres #income