Government Will Increase Age of CPP and OAS Eligibility or Not? As of now, there is no official confirmation the Canadian government is not increasing the age of eligibility for the Canada Pension Plan (CPP)or Old Age Security(OAS). Both benefits are important for retirees.
Age of CPP and OAS
First of All, Take a look through the CPP Eligibility:
- You must be at least 60 years old
- You must have made at least one valid contribution to the CPP
- You must have contributed to the plan through work in Canada.
- The amount you get depends on your earnings and how long you contributed.
- Valid contribution can be either from work you did in Canada or as the result of receiving credits from a former spouse or common-law partner at the end of the relationship.
The CPP and Quebec Pension Plan work together to make sure that all contributors receive a retirement pension. In 2024 the maximum monthly amount you can receive if you begin collecting your pension when you are 65 years old is $1,364.60.
Individuals can qualify to receive CPP benefits anywhere between the age of 60 years and the maximum age of 70, wherein the benefits reduce the earlier one claims the CPP before the age of 65. There is no expected lot to change in the eligibility age in terms of CPP benefits in the year 2025. However Canadian will need to watch out for decisions made on the age of starting taking CPP early or delayed and increased benefits.
OAS Eligibility Requirements
- You must be at least 65 years old
- You need to have lived in Canada for at least 10 years after turning 18. If you are living in Canada. If you are living outside Canada you must have resided in Canada for at least 20 years after turning 18. Full OAS is subject to a clawback if your annual income exceeds $86,912 (2024)
OAS eligibility is not related to your employment history. you may qualify for OAS even if you have never worked or you are still working.
If you qualify for OAS and have a low income, you may also be eligible for the Guaranteed Income Supplement. You can apply for OAS online or by mail.
Government Will Increase Age of CPP and OAS Eligibility?
The federal government hiked the eligibility age for the Old Age Security to 67 from 65 reflecting the reality that Canadians are living longer and healthier lives and may prefer to keep working. However, the changes won’t begin to take effect for another 11 years.
The eligibility age for the OAS program will be gradually raised starting in 2023, with full implementation by 2029. This change will not affect those 54 years old and older. The OAS is the single largest federal government program, costing Ottawa $38 billion in 2011 and projected to increase to $ 108 billion by 2030.
There are no changes to CPP contribution rates and Ottawa is moving forward on the implementation of pension plans.
Increased Old Age Security Pension
Increased old age security pension at age 75. If you are or you will be 75 years old or older in June 2022, you will get an automatic 10% increase in your old age security pension starting in July 2022.
For individuals, if they think they are healthy and can live longer past receiving the amount of 70 years. They can increase the retirement age and get the benefit of both CPP and OAS simultaneously.
Based on changes in the Consumer Price Index, OAS benefits have increased by 1.3% for the October TO December 2024 quarter for an increase of 2.8% over the past years from October 2023 to October 2024.
CPP and OAS Increase
The Canada pension plan and Old Age Security benefits are set to increase in 2025 due to annual indexation adjustments that reflect inflation and cost of living changes.
OAS is indexed quarterly to account for changes in the cost of living-
- Quarterly Adjustments: Benefits are adjusted every three months to match the increase in the CPI.
- Seniors aged 75 and older receive a 10% increase in their monthly OAS payments.
- The exact OAS payment amounts will depend on inflation rates in the last quarter of 2024, which determine the January 2025 indexation.
These increases underscore the government’s commitment to supporting Canadian thoughts’ reliability and protecting income during retirement. Whether you are preparing for Retirement or already receiving benefits staying informed about these updates can help you to plan stability in 2025.
Conclusion :
Both CPP and OAS are important in retirement income planning for Canadians with these adjustments. The standard age to start the pension is 65 you can start receiving it as early as age 60 or as late as age 70.
