How it's different: If you're moving to Canada, the biggest difference you'll notice in the retirement system is that part of your benefits will be determined based on your earnings and part is based strictly on living in Canada. There are special rules that increase your benefits for years you weren't working.
Canada's retirement program has two separate components: the Old Age Security program and the Canada Pension Plan or CPP. Quebec residents have the Quebec Pension Plan, which provides benefits similar to those of the CPP.
To be eligible to receive the Old Age Security Pension, you must be at least 65 years old and meet certain Canadian residency requirements. For most people, living in Canada for 40 full years after turning 18 entitles you to a full pension. The American Social Security program does not take into account the number of years you've lived in the U.S. when figuring your benefits.
The CPP functions similarly to the American Social Security system in that when you start receiving benefits — which can be as early as 60 or as late as 70 — the benefits are based on your work history.
In addition, special provisions allow for adjustments to the benefits formula to account for years in which a person didn't have any earnings. First, up to 17 percent of your contribution time can be discounted if you had no earnings. Second, you can receive additional exclusions for years that you didn't have earnings because you were the primary caregiver for your children.
Under the American Social Security formula, if you don't have 35 years of earnings, a year of $0 of earnings is included in your average for each year fewer than 35 that you have worked, regardless of why you didn't work that year. For example, if you have just 30 years of earnings, five years with $0 earnings will be included when figuring your average.
Related: 5 Social Security Changes to Watch for in 2017