Final answer:
CPP is calculated based on your earnings and contributions over your working years. The amount you receive depends on the average of your earnings throughout your career and the number of years you have contributed to the plan.
Step-by-step explanation:
CPP stands for Canada Pension Plan. The CPP is calculated based on your earnings and contributions over your working years. The amount you receive as a CPP pension depends on the average of your earnings throughout your career and the number of years you have contributed to the plan.
Here's a simplified example: Let's say your average earnings over your career were $50,000. The maximum earnings limit for CPP contributions in 2021 is $61,600. If you contributed to the CPP for 40 years, you would receive 25% of your average earnings up to the maximum earnings limit, which would be $50,000 x 0.25 = $12,500.
Please note that the actual CPP calculation is more complex, taking into account various factors such as contribution rates, earnings exemptions, and drop-out provisions. It is recommended to consult official CPP resources or a financial advisor for precise calculations.