Retirement in Canada isn’t what it used to be—and it’s about to shift even more. With 2025 bringing fresh proposals to the table, the traditional idea of retiring at 65 is being questioned.
The government is eyeing changes to the Canada Pension Plan (CPP) and Old Age Security (OAS) to make them more sustainable as more Canadians live longer and draw benefits longer.
Let’s break down what’s changing, why it’s happening, and how you can prepare.
Table of Contents
Overview
While 65 remains the current standard retirement age, policymakers are suggesting a gradual move toward 67 for receiving full Old Age Security. In parallel, they’re investigating new ways to encourage Canadians to delay taking CPP benefits to age 70, where payouts are highest.
These updates wouldn’t happen overnight—they’re being planned as long-term adjustments to address demographic shifts and rising costs.
Changes
Here’s a look at the current and proposed retirement benefit ages:
| Benefit Type | Current Age | Proposed Change |
|---|---|---|
| CPP (early) | 60 (with reduction) | No change, but delay encouraged |
| CPP (max) | 70 (with increase) | More incentives to delay |
| OAS | 65 | Gradual shift to 67 |
Right now, you can start CPP as early as 60 with reduced monthly payments or delay until 70 to receive larger payouts. OAS is available at 65, but delaying it can also increase the monthly amount. The proposed plan is to shift the OAS full eligibility age to 67 gradually and further promote delaying CPP for higher income security.
Why
So, why is this happening?
By 2040, the number of Canadians aged 65 and older is expected to nearly double. At the same time, people are living longer. That means more years of drawing government benefits, which puts stress on both CPP and OAS.
To keep these programs from running out of funds or needing massive tax hikes, the government wants to spread out the cost. One way to do that is by pushing back the age when full benefits begin and encouraging people to work longer or save more.
Impact
If you’re nearing retirement now—say, in your 60s—don’t panic. These changes won’t hit you suddenly. They’ll likely be phased in over several years. But if you’re in your 40s or younger, it’s time to think differently about your retirement strategy.
Here’s what you might need to plan for:
- Working longer to receive full benefits
- Delaying CPP or OAS to take advantage of higher monthly payments
- Saving more through RRSPs, TFSAs, or employer pensions to cover early retirement years
Strategy
Planning ahead is your best defense. Use the tools available now to map out your retirement path:
- Contribute regularly to your RRSP and TFSA
- Use My Service Canada Account to check your personal CPP and OAS estimates
- Talk to a financial advisor about what these potential changes mean for your long-term plans
It’s all about being proactive. Retirement isn’t one-size-fits-all anymore, and with policy changes on the horizon, customizing your financial future is more important than ever.
Canada’s retirement system is evolving, and while change can be uncomfortable, it’s also a chance to create a more stable and flexible path forward. Whether you plan to retire at 60 or 70, now’s the time to sharpen your savings strategy and stay informed.
FAQs
Is retirement age in Canada changing?
Yes, proposals suggest shifting OAS age to 67.
Can I still take CPP at 60?
Yes, but with reduced monthly payments.
When will the new rules take effect?
They will be phased in gradually over time.
Why are CPP and OAS changing?
To ensure long-term sustainability of the programs.
How can I prepare for later retirement?
Save more, delay benefits, and check My Service Canada.
