5 Things Americans Should Know About Retiring In Canada

Forbes

30-04-2025

Living close to nature is one of the benefits of retiring in Canada
Over 1 million Americans live in Canada, according to the Association of Americans Resident Overseas. Canada is a popular choice for retirement because it's close, largely English-speaking, and offers a peaceful, familiar culture.
As the second-largest country in the world, Canada boasts an abundance of untouched nature and diverse lifestyle options—from the quaint coastal towns of the Pacific Northwest and Maritimes to the rural lifestyles in the Great Plains to Rocky Mountain ski villages and the big city buzz of Toronto, Montreal, and Vancouver.
For Americans, accessing Canada's lifestyle benefits can be as simple as packing up your home and heading north of the border. But there are practical matters to consider before making the move.
Here's an overview of what Americans should know about retiring in Canada.
The pros of retiring in Canada include:
Some of the challenges of retiring in Canada include:
Canada has diverse climate zones, however. You can seek out milder coastal regions, where the ocean moderates temperatures. Alternatively, you could become a snowbird, an expat who spends winters in warmer climates to avoid the cold.
Here's an overview of average home prices in Canada's most populated provinces, according to WOWA.ca. (All prices are listed in U.S. dollars.)
Compare that to average home prices in the U.S.'s most populated states (according to Zillow):
Other costs add up too. A gallon of gas currently costs around $3.60 in Canada and around $3.15 in the States. Monthly food expenses for a family of four are around $1,014 in Canada and $996 in the U.S.
Fortunately, the strength of the U.S. dollar compared to the Canadian dollar currently provides Americans with a modest currency advantage, which helps offset some of these costs.
U.S. citizens must file U.S. taxes on their worldwide income regardless of where they live. Moving to Canada doesn't change that.
However, living abroad can trigger new reporting requirements like FBAR (for foreign bank accounts totaling over $10,000) and Form 8938 (if you hold significant foreign financial assets).
You may also owe Canadian taxes if you're deemed a resident, but thanks to the U.S.-Canada Tax Treaty, most people can avoid double taxation by claiming foreign tax credits.
Moving to Canada doesn't close your IRAs, 401(k)s, Roth IRAs, or other retirement accounts. You can continue to own these accounts and take contributions according to U.S. rules.
You may face some challenges, however. Some U.S. brokerages impose restrictions on account holders with foreign addresses, limiting your ability to make trades or reallocate investments.
In many cases, you won't be able to contribute to your IRAs or 401(k)s unless you maintain U.S.-sourced earned income. You can't transfer U.S. retirement accounts into Canadian retirement vehicles.
Some financial institutions won't send distributions to a foreign bank. You may need a U.S. bank account to receive IRA or 401(k) distributions and then transfer them internationally—potentially incurring wire fees and currency conversion costs.
Canada doesn't offer a retiree visa or an investor visa for financially independent people without employment plans.
Most immigration streams are geared toward filling labor shortages, such as skilled worker programs for healthcare, construction, and technology.
However, Americans can visit Canada for up to six months at a time without a visa. For many retirees, spending part of the year in Canada as a long-term tourist offers a way to enjoy Canada's lifestyle without the complexities of immigration.
Canada offers a peaceful, beautiful, welcoming environment for retirement, but it comes with its own set of challenges—higher taxes, high housing costs, and harsh winters in many areas. For those who prepare thoughtfully, Canada can deliver a high quality of life, access to excellent healthcare, and a warm, friendly community just north of the border.