In 2025, retirees in Canada are in for a welcome increase in their monthly pension benefits. The rise in the Canada Pension Plan (CPP) and Old Age Security (OAS) pensions will make a significant difference to retirees who are grappling with rising costs of living.
Whether it’s covering the cost of groceries, healthcare, or housing, the pension increases are designed to ease financial pressure. Here’s a detailed breakdown of what you can expect and how to ensure you’re receiving your full entitlement.
Canada’s Federal Retirement Benefits in 2025: Breakdown of the Increase
The Canada Pension Plan (CPP) and Old Age Security (OAS) provide essential income to Canadian seniors. As of 2025, the increases are as follows:
| Program | Maximum Monthly Amount (2025) |
|---|---|
| CPP | $1,433 |
| OAS (65–74) | $727.67 |
| OAS (75+) | $800.44 |
| Combined CPP + OAS (75+) | $2,233.44 |
This means that if you’re 75 or older and entitled to both the full CPP and OAS, your total monthly income could reach up to $2,233.44 or around $26,800 annually.
This increase is a real game-changer for many seniors, offering a much-needed boost to their financial well-being.
Understanding the Canada Pension Plan (CPP)
The Canada Pension Plan (CPP) is a retirement plan funded by contributions from both workers and their employers during their working years. When you retire, the amount you receive depends on several factors:
- How much you’ve contributed over the years.
- How long you contributed (the number of years worked).
- The age you choose to start receiving benefits.
For 2025, the maximum monthly CPP pension for someone starting at age 65 is $1,433. However, not everyone will receive the maximum amount—many Canadians will receive a lower amount based on their lifetime contributions. On average, CPP payments are about $808 per month.
Timing Matters for CPP
You can start receiving CPP benefits anywhere between ages 60 and 70. If you decide to wait beyond age 65, your CPP payments will increase by approximately 0.7% per month.
Delaying until age 70 can provide a significant increase—up to 40% more than what you would receive at age 65. For example, if you’re eligible for $800 at 65, delaying until 70 would give you around $1,120 monthly.
Old Age Security (OAS): A Key Benefit for Seniors
Unlike CPP, OAS is not based on your contributions but rather your age and residency in Canada. To qualify for OAS, you must meet the following criteria:
- Be 65 or older.
- Have lived in Canada for at least 10 years after age 18 for partial benefits, or 40 years for the full amount.
For 2025, the monthly OAS rates are:
- $727.67 for those aged 65 to 74.
- $800.44 for those aged 75 and older.
These amounts are adjusted every quarter based on inflation, ensuring that retirees’ benefits keep up with the rising cost of living.
Putting It All Together: A Comprehensive Retirement Income
For a retiree aged 75 or older, receiving both CPP and OAS, the total monthly retirement income can be substantial—up to $2,233.44.
This is an important financial foundation before considering other forms of government support, such as the Guaranteed Income Supplement (GIS), or tax refunds like the GST credit.
Example: Helen’s Retirement Income
Helen is 70 years old and has worked for 30 years, followed by a 10-year career break to care for her children. She decides to start both her CPP and OAS benefits at age 70, receiving:
- $970 per month from CPP.
- $800.44 per month from OAS.
Total monthly income: $1,770.44, plus GIS to further boost her financial security.
Key Tips & Strategies for Maximizing Your Pension
- Consider Delaying Your CPP
If you’re in good health, delaying your CPP until age 70 can significantly increase your monthly payments, up to 40% more. - Know Your OAS Triggers
If you delay your OAS past age 65, it increases by 0.6% per month, up to 36% by age 70. Weigh your options to decide the best course for your finances. - Review Your Contributions
Ensure the accuracy of your CPP contributions by logging into your My Service Canada Account. Missing or incorrect contributions can affect your benefit amounts. - Apply for GIS
If your income is low, you may qualify for the Guaranteed Income Supplement (GIS), providing up to $1,065 per month for single seniors. - Consider Pension Splitting
If your spouse receives higher CPP benefits, pension splitting can reduce your overall tax burden, potentially providing tax savings. - Watch for OAS Clawbacks
If your adjusted net income exceeds $90,997 in 2025, your OAS payments may be reduced or clawed back. Plan your income strategy accordingly. - Continue Working Thoughtfully
If you claim CPP before age 65 and continue working, your contributions will go into the Post-Retirement Benefit, which can further increase future CPP payments.
Beyond CPP and OAS: Other Retirement Savings Plans
Besides CPP and OAS, it’s important to plan for additional retirement savings:
- Registered Retirement Savings Plans (RRSPs)
- Tax-Free Savings Accounts (TFSAs)
- Employer pensions
- Other provincial benefits
What You Can Do Now
- Log into your My Service Canada Account to review your CPP and OAS history.
- Use the Retirement Income Calculator available on Canada.ca to get a clearer picture of your retirement income.
- Consider when you want to start CPP and/or delay OAS.
- Apply early—CPP applications can be done up to 12 months before you want to start receiving payments.
- Speak with a financial planner about pension splitting and OAS clawbacks.
In 2025, the rise in Canada’s Retirement Pension is a significant opportunity for seniors to better manage their financial security in retirement.
With careful planning and consideration of the timing of your CPP and OAS benefits, you can maximize your monthly income and enjoy a comfortable retirement.
FAQs
What is the maximum amount I can receive from CPP in 2025?
The maximum monthly CPP pension for someone starting at age 65 is $1,433.
How can I increase my OAS payments?
Delaying OAS past age 65 can increase payments by 0.6% per month, up to 36% more by age 70.
Can I receive GIS in addition to CPP and OAS?
Yes, seniors with low income can qualify for the Guaranteed Income Supplement (GIS), which provides additional financial support.