Canada’s Retirement Landscape Is Changing—Here’s What It Means for CPP and OAS
For generations, turning 65 meant one thing for Canadians: retirement. It was the age when Old Age Security (OAS) and the Canada Pension Plan (CPP) kicked in. But in 2025, that once-firm milestone is beginning to blur. With Canadians living longer, working past traditional retirement age, and federal benefits offering incentives to delay, it may be time to rethink when and how retirement begins.
Here’s how shifting policies and economic realities are reshaping what retirement looks like in Canada today.
Table of Contents
The End of a Fixed Retirement Age
The idea of retiring at 65 is rooted in policies set decades ago when life expectancy was much lower. Today, the average Canadian lives well into their 80s, and retirement can last 20 to 30 years—putting new pressure on savings, pensions, and public programs.
Rising living costs, inflation, and housing expenses are also pushing more Canadians to continue working past 65, not just for financial reasons, but for social connection and purpose.
What’s Changing With the Canada Pension Plan (CPP)?
While Canadians can still start receiving CPP at 60, doing so comes with a trade-off: reduced monthly payments. Conversely, waiting until age 70 can mean a significantly larger pension chequ.
How CPP benefits change by age:
- Start at 60: 36 percent reduction
- Start at 65: Standard full benefit
- Start at 70: 42 percent increase
That means if you delay claiming CPP until age 70, you could receive nearly half again as much every month compared to starting at 65.
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OAS: Waiting Pays Off Here Too
The Old Age Security pension is another pillar of retirement income in Canada. It kicks in at 65, but delaying it can also bring higher monthly payments.
OAS benefit increase if delayed:
- Start at 65: Full standard amount
- Start at 70: Up to 36 percent more per month
While deferral is optional, it’s a key strategy for Canadians who can afford to wait and want to maximize their guaranteed monthly income later in life.
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Could the Official Retirement Age Increase?
The Canadian government previously proposed raising the OAS eligibility age to 67 but reversed the decision in 2016. However, with increasing pressure on public pensions and the aging population, that debate isn’t over.
Other countries like the United States, United Kingdom, and Australia are already phasing in higher retirement ages, and experts believe Canada may eventually do the same to preserve the long-term viability of its pension systems.
Canadians Are Working Longer Than Ever
According to Statistics Canada, the number of people aged 65 and over who are still working has doubled since 2000. Today, nearly 1 in 5 seniors remain in the workforce. Many are working part-time, freelancing, or consulting—not just to supplement income, but to stay mentally active and socially engaged.
Retirement Planning: Flexibility Is Now Essential
Retirement today isn’t defined by a single age—it’s a sliding scale based on individual finances, health, and goals. Here are some steps to help plan your retirement under the new rules:
- Know your numbers: Learn how CPP and OAS benefits increase if you delay claiming them.
- Use retirement calculators: Estimate how long your savings need to last.
- Stay informed: Track updates to pension policies and government benefit changes.
- Consider phased retirement: Gradually reducing work hours can ease the transition and stretch income.
Whether you retire early, late, or somewhere in between, the most important thing is having a flexible plan that adapts to your personal needs and Canada’s evolving policies.
Fact Check: No Official Age Increase Yet, But Delaying Still Pays
As of June 2025, the official age to collect OAS remains 65, and CPP can still be claimed from age 60. Delaying either benefit can significantly increase monthly payments—up to 42 percent more for CPP and 36 percent more for OAS if claimed at age 70.
There is no federal law in effect to raise the retirement age, but previous proposals and ongoing debates suggest the possibility remains on the table.
In the meantime, Canadians are encouraged to weigh their options carefully and create a retirement plan that supports long-term financial stability.
Canada’s Retirement Landscape Is Changing—Here’s What It Means for CPP and OAS
For generations, turning 65 meant one thing for Canadians: retirement. It was the age when Old Age Security (OAS) and the Canada Pension Plan (CPP) kicked in. But in 2025, that once-firm milestone is beginning to blur. With Canadians living longer, working past traditional retirement age, and federal benefits offering incentives to delay, it may be time to rethink when and how retirement begins.
Here’s how shifting policies and economic realities are reshaping what retirement looks like in Canada today.
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The End of a Fixed Retirement Age
The idea of retiring at 65 is rooted in policies set decades ago when life expectancy was much lower. Today, the average Canadian lives well into their 80s, and retirement can last 20 to 30 years—putting new pressure on savings, pensions, and public programs.
Rising living costs, inflation, and housing expenses are also pushing more Canadians to continue working past 65, not just for financial reasons, but for social connection and purpose.
What’s Changing With the Canada Pension Plan (CPP)?
While Canadians can still start receiving CPP at 60, doing so comes with a trade-off: reduced monthly payments. Conversely, waiting until age 70 can mean a significantly larger pension cheque.
How CPP benefits change by age:
- Start at 60: 36 percent reduction
- Start at 65: Standard full benefit
- Start at 70: 42 percent increase
That means if you delay claiming CPP until age 70, you could receive nearly half again as much every month compared to starting at 65.
OAS: Waiting Pays Off Here Too
The Old Age Security pension is another pillar of retirement income in Canada. It kicks in at 65, but delaying it can also bring higher monthly payments.
OAS benefit increase if delayed:
- Start at 65: Full standard amount
- Start at 70: Up to 36 percent more per month
While deferral is optional, it’s a key strategy for Canadians who can afford to wait and want to maximize their guaranteed monthly income later in life.
Could the Official Retirement Age Increase?
The Canadian government previously proposed raising the OAS eligibility age to 67 but reversed the decision in 2016. However, with increasing pressure on public pensions and the aging population, that debate isn’t over.
Other countries like the United States, United Kingdom, and Australia are already phasing in higher retirement ages, and experts believe Canada may eventually do the same to preserve the long-term viability of its pension systems.
Canadians Are Working Longer Than Ever
According to Statistics Canada, the number of people aged 65 and over who are still working has doubled since 2000. Today, nearly 1 in 5 seniors remain in the workforce. Many are working part-time, freelancing, or consulting—not just to supplement income, but to stay mentally active and socially engaged.
Retirement Planning: Flexibility Is Now Essential
Retirement today isn’t defined by a single age—it’s a sliding scale based on individual finances, health, and goals. Here are some steps to help plan your retirement under the new rules:
- Know your numbers: Learn how CPP and OAS benefits increase if you delay claiming them.
- Use retirement calculators: Estimate how long your savings need to last.
- Stay informed: Track updates to pension policies and government benefit changes.
- Consider phased retirement: Gradually reducing work hours can ease the transition and stretch income.
Whether you retire early, late, or somewhere in between, the most important thing is having a flexible plan that adapts to your personal needs and Canada’s evolving policies.
Fact Check: No Official Age Increase Yet, But Delaying Still Pays
As of June 2025, the official age to collect OAS remains 65, and CPP can still be claimed from age 60. Delaying either benefit can significantly increase monthly payments—up to 42 percent more for CPP and 36 percent more for OAS if claimed at age 70.
There is no federal law in effect to raise the retirement age, but previous proposals and ongoing debates suggest the possibility remains on the table.
In the meantime, Canadians are encouraged to weigh their options carefully and create a retirement plan that supports long-term financial stability.
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