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A guide to realistic financial projections
Planning clients’ financial lives starts with realistic projections. Financial planners (F.Pl.) must estimate inflation, interest rates, investment returns and other factors to build their long-term projections.
To support them, the Institute of Financial Planning and FP Canada Standards CouncilTM publish the Projection Assumption Guidelines each year: reliable benchmark assumptions for producing consistent and comparable projections over time.
Why use them?
- They provide a solid starting point for all your projections.
- They help protect clients and ensure professional rigor.
- They are based on public and credible sources, updated annually to ensure their relevance.
Current Guidelines
The Projection Assumption Guidelines for 2026 are the following (before any adjustments for administrative and investment management fees):
Inflation rate |
2,10% |
Return rates |
|
Short-term |
2,40% |
Fixed income |
3,20% |
Canadian equities |
6,30% |
U.S. equities |
6,40% |
International developed-market equities |
6,60% |
Emerging market equities |
7,50% |
Borrowing rate |
4,40% |
YMPE, MPE growth rate or salary |
3,10% (inflation + 1%) |
Shelter projection considerations |
3,10% (inflation + 1%) |
Note that the administrative and investment management fees paid by clients both for products and advice must be subtracted to obtain the net return.
Life expectancy
The table used to calculate the probability of survival is the CPM2014 Mortality Table.
It varies depending on several factors, including:- gender
- health status
- being retired
- certain socioeconomic characteristics
Current Age |
10% |
25% |
35% |
50% |
||||||||||||||||
M |
F |
M/F |
M/M |
F/F |
M |
F |
M/F |
M/M |
F/F |
M |
F |
M/F |
M/M |
F/F |
M |
F |
M/F |
M/M |
F/F |
|
20 |
99 |
101 |
102 |
101 |
103 |
95 |
98 |
99 |
98 |
100 |
93 |
96 |
98 |
96 |
99 |
90 |
93 |
96 |
94 |
97 |
30 |
99 |
101 |
102 |
101 |
103 |
95 |
97 |
99 |
98 |
100 |
93 |
95 |
97 |
96 |
98 |
90 |
93 |
95 |
94 |
96 |
40 |
98 |
101 |
102 |
100 |
103 |
95 |
97 |
99 |
97 |
100 |
93 |
95 |
97 |
96 |
98 |
90 |
92 |
95 |
94 |
96 |
50 |
98 |
100 |
101 |
100 |
102 |
94 |
97 |
98 |
97 |
99 |
92 |
95 |
97 |
95 |
98 |
89 |
92 |
95 |
93 |
96 |
60 |
98 |
100 |
101 |
100 |
102 |
94 |
96 |
98 |
97 |
99 |
92 |
94 |
96 |
95 |
97 |
89 |
91 |
94 |
93 |
95 |
70 |
98 |
100 |
101 |
99 |
102 |
94 |
96 |
98 |
97 |
99 |
92 |
94 |
96 |
95 |
97 |
89 |
91 |
94 |
93 |
95 |
80 |
98 |
100 |
101 |
100 |
102 |
94 |
96 |
98 |
97 |
99 |
93 |
95 |
97 |
95 |
98 |
90 |
92 |
95 |
94 |
96 |
90 |
99 |
101 |
102 |
101 |
103 |
97 |
98 |
99 |
98 |
100 |
95 |
97 |
98 |
97 |
99 |
94 |
95 |
97 |
96 |
98 |
100 |
105 |
105 |
106 |
106 |
107 |
103 |
103 |
104 |
104 |
105 |
102 |
103 |
104 |
103 |
104 |
102 |
102 |
103 |
103 |
103 |
Calculators
The calculators developed using the Projection Assumption Guidelines are now available in downloadable format.
We recommend saving the files for quick access in your practice. Please note that they will be updated annually in April. You will need to download them again at that time.
This section will continue to evolve. Additional calculators and complementary tools may be added over time.
Pay down the mortgage or save up?
Compare the potential of paying down your mortgage and saving through registered plans using different financial assumptions.
Download the mortgage or save calculator arrow_forwardPortfolio return calculator
Estimate the expected return of a portfolio based on asset allocation and the recommended assumptions for your financial projections.
Download the portfolio return calculator arrow_forwardQPP value simulator
Estimate the present value of accrued QPP pension benefits and future contributions for your financial projections.
Download the QPP value simulator arrow_forwardTo go further
These supplementary documents offer different levels of detail to help you better understand and use the Projection Assumptions Guidelines in your practice. Whether you wish to explore the underlying methodology in greater depth or access a summary version, you will find information suited to your needs.
Download the various documents to learn more.
Addendum
Data sources to support a deeper understanding and replicate the calculations
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Printable leaflet
Short version designed for quick reference or printing (8.5 x 11 format)
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