The Canada Pension Plan (CPP) and Old Age Security (OAS) are set to see some changes in 2025. These changes could mean more money for Canadian retirees. One of the biggest changes is the potential for a $3,500 combined monthly payment from CPP and OAS.
To qualify for this amount, seniors must have made the maximum CPP contributions for at least 39 years. They also need to have lived in Canada for at least 40 years after turning 18 to receive the full OAS amount. Delaying benefits can also increase payments.
CPP benefits increase by 8.4% per year if delayed until age 70. OAS benefits increase by 7.2% annually if deferred until 70. Low-income seniors may also qualify for the Guaranteed Income Supplement (GIS) to supplement their OAS benefits.
To maximize CPP and OAS benefits, seniors should:
1. Review their CPP contribution history using the My Service Canada Account portal. 2.
Decide when to start benefits, considering the increases from delaying until age 70.
cpp and oas payment boosts
3.
Consider spousal benefits like the CPP survivor’s pension or pension splitting. 4. Plan for the tax implications of CPP and OAS, which are both taxable.
5. Apply for GIS if eligible based on their annual income. Other tips for retirement planning include saving in RRSPs or TFSAs, downsizing to a more affordable home, working part-time, and considering healthcare costs and long-term care insurance.
CPP and OAS payments will also see increases in 2025 due to inflation indexing. The CPP enhancement program, which aims to increase CPP benefits from covering 25% to 33% of a recipient’s average working income, will also boost payments. OAS payments are issued monthly, with the last week of each month being the usual payment time.
Notable payment dates for 2025 include January 29 and February 26. Seniors can delay OAS payments for up to five years to increase their benefits by 0.6% per month. Low-income seniors may also qualify for GIS to further enhance their OAS benefits, potentially receiving over $1,800 monthly in total.
By understanding these changes and taking steps to maximize their benefits, Canadian retirees can ensure a more financially secure retirement in 2025 and beyond.
