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Early retirement 101: the importance of being financially and emotionally ready

As much as a career in education can be immensely rewarding, it can also be incredibly exhausting.

So, it probably comes as no surprise that many members are choosing to retire before reaching their 85- or 90-factor. Because when your education tank is running on empty, the grass can seem a whole lot greener on the pension-collecting side of the fence.

But here’s the thing; when you’re finally in retirement, reality is six to one, half dozen to the other.

In other words, it’s not necessarily a matter of the grass being greener in retirement. There’s just an exorbitant amount of time to watch it grow there. You only have to ask the 27% of Canadian retirees who regret leaving their careers—more than half of which because of a lack of mental stimulation. This goes to show you how important it is to consider the emotional, as well as the financial implications of retiring early.

To ensure early retirement won’t leave you struggling to make ends meet, it’s important to identify any potential pension income gaps.

And those gaps could exist regardless of whether you retire sooner or later.

Yet according to Educators Certified Financial Planner professional Kody Fanara, many education members share a common misconception when it comes to anticipating their financial situation in retirement.

“Some educators seem to think their expenses are going to go down in retirement,” says Kody. “But this is false. Since many of them are still paying off mortgages and other debt, their expenses will most likely remain the same—with one key difference. They’ll be covering those expenses on less income.”

You have a pension, but will you have enough to retire?

Use our Pension Income Gap Calculator to find out you’re on track to fund your retirement dreams.



“As retirees find ways to fill their newfound time, certain expenses such as travel and entertainment typically increase in retirement. Plus like most of us, they’ve become accustomed to a certain type of lifestyle during their working years. Without making adjustments to their spending habits, it can be difficult to maintain that lifestyle in retirement—which can lead to expenses increasing in some cases. Hence why it’s so important for education members to identify a potential pension income gap before they retire.”

In order to determine whether you can live with a reduction in pension income, Kody recommends the following.

“If you feel emotionally ready to retire, even if you haven’t reached the 85- or 90-factor, get an estimate of what your pension payments would be by logging in to your pension website. If you’re close to reaching your qualifying factor, you might be looking at a very insignificant drop. On the other hand, you still might be able to financially get by on a reduced pension, even if you’re more than a few years away from reaching it. Since everybody’s situation is unique, it’s best to compare the numbers first (I.e. expected pension income vs. current financial needs). That way you can go into retirement with a better idea on what to expect, income-wise.”

Use our Pension Income Gap Calculator to see what your cash flow situation might be like in retirement.

If you discover that retiring early isn’t financially feasible, there are ways to fill the income gap.

For starters, you could always continue working within education.

You might think that it doesn’t make sense to work past your 85/90-factor since your pension won’t increase by much (approximately 2% for every year you delay taking it). Yet there are other factors to consider.

For example, are you younger than 60?

By delaying retirement, you’ll be another year closer to being able to take CPP (which can be collected starting at age 60).

There is also the option of getting a part-time job after retiring from education, or pivoting to an entirely different career. After all, just because education members tend to retire earlier than the average Canadian, doesn’t mean that you have to live out the rest of your days in full-time retirement.

Speaking about the rest of your days—before retiring, you should also give some thought to the option you want to pick for your survivor benefits.

As a teacher, you can select anywhere between 50% and 75% (with the default being 60%).

There is also an optional 10-year guarantee, where the surviving spouse of an education member would receive 100% of their pension benefits if the retired teacher passes away within the first 10 years of retirement.

If your plan is to retire early, there might be pros to choosing one survivor benefit over another. So, be sure to take some to review and fully understand your options before making any decisions.

Visit OTPP’s online Survivor Benefits page for more information.

On the emotional side of retiring, it’s all about figuring out how to go about filling your ‘school days’.

At first, going from hectic ‘working life’ to having all the time in the world can be total bliss. But needing a sense of purpose has a way of catching up with us all. So while you should by all means take some time to relax and recharge your batteries, it’s important to establish a new routine quickly.

To further help ease the emotional transition into (early) retirement:

  • Go into retirement with an open mind and a minimal set of expectations
  • Revisit unaccomplished goals, or set new ones to reignite/maintain a sense of purpose
  • Talk honestly and openly with your spouse and loved ones about how you’re feeling
  • Don’t be afraid to ask for help if you’re having difficulty making the transition (this is normal)
  • Find ways to stay fit physically—which has proven to have a positive impact on mental health
  • Maintain a sense of community with your family, friends, and peers

Plus you can always reach out to the team of retirement experts at Educators Financial Group.

Since we fully understand the specifics of OTPP and OMERS, we can help you to financially prepare for retirement by identifying any pension income gaps. Then we’ll show you how to fill them. That way you can transition into retirement, worry-free.

Lean on us—we’re your ‘early retirement support network’.


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What are your retirement goals – travel, gardening, time with your grandkids? As an education member you’ve worked hard for your pension, but will it be enough?

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