Retirement is a major milestone in life and understanding the eligibility age for your government benefits in Canada is more important than ever. You may have heard discussions about changes coming to the retirement age, and you’re not alone.
These conversations have grown louder as speculation continues around potential increases to the Old Age Security (OAS) and Canada Pension Plan (CPP) eligibility ages. Many Canadians are wondering how these potential updates will affect their retirement planning and finances.
If you’re approaching retirement or planning ahead, it’s crucial to understand how these systems work now and what changes may be coming soon.
The Government of Canada has yet to make any official announcement, but several reports and discussions suggest the retirement age could move from 65 to 67 starting in 2025. This blog breaks it all down in detail so you can prepare with confidence. Let’s explore what this might mean for you and your future.
What Is the Current Retirement Age in Canada for CPP and OAS?
Understanding the current rules is the first step toward making informed decisions about your retirement. In Canada, the standard retirement age for both the Canada Pension Plan (CPP) and Old Age Security (OAS) is 65. This is the age at which you can receive full benefits without any penalties or reductions.
However, Canadians have some flexibility. You can start receiving CPP as early as 60, but doing so results in reduced monthly payments. On the other hand, if you choose to delay receiving CPP until age 70, you can earn increased monthly benefits. For OAS, the minimum age is strictly 65, but like CPP, you can defer it up to age 70 to receive larger monthly payments.
Additionally, Guaranteed Income Supplement (GIS) is available for low-income seniors starting at age 65. Unlike CPP or OAS, GIS cannot be taken early or deferred beyond that age.
These benefits are funded differently, with CPP being a contributory program and OAS a non-contributory, tax-funded benefit. With these systems currently in place, the age of 65 has long been seen as the benchmark for full retirement in Canada.
Is Canada Increasing the Retirement Age to 67 in 2025?
A growing conversation has emerged in Canada around potentially increasing the retirement age for social security benefits. While the government has not officially confirmed any changes, multiple reports suggest a possible shift to age 67 beginning in or after October 2025, especially for those born after 1960.
The reason for this speculation is based on ongoing discussions about financial sustainability. The increasing life expectancy of Canadians means that more people are drawing from pension funds for longer periods. As a result, the idea of changing the eligibility age is being closely considered.
Here are key takeaways:
- The current legal retirement age remains 65
- A change to 67 may be implemented for new applicants after October 2025
- Individuals already receiving CPP or OAS will not be affected
- The Canada Revenue Agency (CRA) has not made a formal announcement
- Citizens born after 1960 are likely to be most affected by the change
Until the CRA makes an official declaration, the retirement age is still 65. However, planning ahead for this possible increase is wise, especially if you are nearing retirement or making long-term financial decisions.
Why Might the Government Increase the Retirement Age in Canada?
The potential increase in the retirement age isn’t arbitrary. There are several key reasons behind this discussion, mostly linked to the evolving economic and demographic landscape in Canada.
The main driving force is the increase in life expectancy. Canadians are living longer and therefore collecting retirement benefits for a more extended period. This extended lifespan puts pressure on the sustainability of programs like CPP and OAS, which were initially designed when life expectancies were shorter.
Here’s why the government may implement changes:
- Longer life expectancy means more years of pension payouts
- A smaller working-age population is contributing to the pension system
- The number of CPP contributors has declined over recent years
- The financial strain on the government could increase without adjustments
- Delaying retirement encourages savings and economic productivity
By gradually increasing the retirement age, the government can reduce the number of people drawing benefits at once, easing the load on the system. This also encourages Canadians to stay in the workforce longer and better prepare financially for retirement.
The move is seen as a proactive step toward ensuring that the pension system remains reliable for future generations, while also promoting individual responsibility in retirement planning.
How Will the New Retirement Age Impact Your CPP and OAS Benefits?
If you’re planning to retire soon, the idea of a raised retirement age may cause some concern. A shift from age 65 to 67 could impact your ability to access your full government benefits. Understanding these impacts can help you make smarter choices.
Early Retirement Penalties
If you choose to retire early, you can still access CPP starting at age 60. However, taking early retirement means accepting reduced monthly payments for life. With the proposed increase to 67 for full retirement, the gap between early and full benefits becomes even wider. That could lead to a greater long-term reduction in your total pension income.
- CPP taken at age 60 will be reduced by a fixed percentage per month before age 65
- If the full retirement age becomes 67, the early penalty may increase
- Early retirement will be less financially attractive than before
Delayed Retirement Benefits
On the other hand, delaying retirement beyond 65 continues to have its perks. By waiting until age 70, retirees can enjoy increased monthly benefits. This structure is designed to encourage Canadians to work longer, especially if the age is officially pushed to 67.
- Delaying CPP and OAS until 70 can significantly increase monthly payments
- You’ll receive fewer total payments, but at a higher rate
- This strategy works best for those with longer life expectancy
Impact on Low-income Retirees
Low-income individuals are likely to be affected the most. Many people rely on GIS and OAS to cover basic living expenses. If access to these benefits is delayed until 67, they may face a two-year income gap.
- GIS and OAS currently begin at age 65
- Delaying them could increase financial hardship
- Those with lower life expectancy may get fewer years of support
In summary, a change in retirement age to 67 introduces new challenges, particularly for vulnerable populations. Planning ahead is key to navigating these potential shifts.
Can You Still Apply for CPP at 60 or OAS at 65 in 2025?
One of the most common questions from soon-to-be retirees is whether the early access rules for CPP and OAS will remain in place if the retirement age is increased. As it stands now, yes, you can still apply for CPP at age 60 and OAS at age 65.
However, if the retirement age changes in October 2025, new applicants may face revised age requirements. Those currently receiving benefits or applying before any official change should remain unaffected.
Here’s what to know:
- CPP early access at 60 is expected to continue, but with reduced payments
- OAS requires you to be at least 65, though deferral up to 70 is allowed
- The new age requirement may apply only to those born after 1960
- Those applying before October 2025 are expected to follow current rules
Until changes are officially announced, it is safe to plan with the current system. However, you should remain flexible and informed to adjust when necessary.
Planning Ahead: What Should You Do If the Retirement Age Changes?
Retirement planning is already complex, and a potential change in retirement age adds a new layer of strategy. If you’re preparing for retirement in the coming years, now is the time to reassess your plans and explore your options.
Saving More and Retiring Smarter
The most important step is boosting your savings. If you need to wait longer for government benefits, having additional funds in RRSPs, TFSAs, or other investments can help bridge the gap.
- Increase your monthly contributions
- Consider employer-sponsored pension plans
- Automate your savings for consistent growth
Rethinking Your Retirement Timeline
With the possibility of retiring at 67, it may be necessary to re-evaluate your ideal retirement age. Factor in your health, employment satisfaction, and financial preparedness.
- Reassess your retirement goals based on the new age
- Work part-time or consult in later years to supplement income
- Align your timeline with your long-term lifestyle expectations
Using RRSPs and Personal Savings
Your personal savings will play a bigger role if government pensions are delayed. Understanding how to withdraw efficiently from RRSPs or utilize your TFSAs will be essential.
- Develop a tax-efficient withdrawal strategy
- Use TFSAs for tax-free supplemental income
- Maintain emergency savings for unexpected expenses
Being proactive with these strategies helps reduce the impact of any official changes. The more prepared you are, the smoother your transition into retirement will be.
Quick Comparison: Current vs. Expected Retirement Rules
Understanding the possible shift in policy requires a clear side-by-side comparison of what’s in place now versus what’s expected in the future. Here’s how things could look if the retirement age changes in 2025.
| Feature | Current Rule | Possible Rule (2025 Onwards) |
| CPP Early Eligibility | 60 years | 60 years (unchanged) |
| CPP Full Retirement | 65 years | 67 years |
| OAS Eligibility | 65 years | 67 years |
| OAS Maximum Delay | 70 years | 70 years (unchanged) |
| GIS Access | 65 years | Possibly 67 years |
| Impacted Groups | All applicants | Born after 1960 |
While nothing is final, the trend points toward encouraging longer work lives and increased personal financial responsibility.
What Happens to Existing CPP and OAS Beneficiaries in 2025?
If you’re already receiving CPP or OAS, there’s good news. All current beneficiaries will continue receiving their payments even if the retirement age changes in the future. The adjustment, if implemented, would most likely only affect new applicants.
Here’s how existing beneficiaries are protected:
- No changes to benefit amounts or timelines
- No need to requalify or reapply
- Continued support through direct CRA deposits
The shift in retirement age is expected to apply only to new applicants after October 2025, particularly those born after 1960. The CRA has indicated that any official changes will be publicly updated on their website. It’s important to stay informed, but you don’t need to worry if you’re already retired.
Conclusion
With discussions about increasing the Canada OAS CPP retirement age gaining traction, it’s critical to understand both current and potential future rules. While the retirement age remains at 65 for now, the possibility of a shift to 67 starting in late 2025 means you should stay updated and flexible with your retirement planning.
Whether you’re planning to retire early or considering delaying your benefits, the right strategy will depend on your financial situation, health, and long-term goals.
Being proactive today can lead to better outcomes tomorrow. Keep informed, save diligently, and be ready to adjust as official announcements unfold.
FAQs
Will the retirement age in Canada definitely change to 67?
The change has not been officially confirmed, but it is under serious consideration by the government.
Can I still get CPP at age 60 if the retirement age increases?
Yes, early access to CPP at age 60 is expected to remain available with reduced benefits.
Will current retirees lose their benefits if the rules change?
No, existing CPP and OAS beneficiaries will continue receiving payments without any interruptions.
Why is the Canadian government considering this change?
Rising life expectancy and financial strain on the pension system are key reasons behind the proposed changes.
What if I retire before the new retirement age takes effect?
You are likely to be grandfathered into the current system and not affected by the changes.
Is Guaranteed Income Supplement affected by the retirement age change?
As of now, GIS eligibility rules remain the same and are not officially impacted by any proposed changes.
How can I prepare for the potential retirement age change?
Boost your personal savings, reassess your retirement plan, and stay updated with official announcements from CRA.
