Benefit payments for Canadian seniors are going up slightly in a scheduled increase as retirement is “becoming unaffordable” for many in the country.
July amounts of the Old Age Security (OAS) benefits, going out on Monday, are increasing by 2.8 per cent compared with the previous year after adjusting for inflation.
For the July to September period, OAS benefits are rising by 0.7 per cent, according to the government.
The OAS pension was permanently increased by 10 per cent for seniors aged 75 and over in July 2022. These are monthly taxable payments that go out to Canadians aged 65 years or older.
The amounts are reviewed each year in January, April, July and October to reflect cost of living increases, as measured by the Consumer Price Index (CPI).
How much will Canadian seniors get?
The OAS pension amount is based on a person’s age, how long they’ve lived in Canada as an adult, and their income.
On July 29, eligible seniors aged 65 to 74 years were to receive a maximum monthly amount of up to $718.33.
For those aged 75 and older, the maximum monthly payment is set for $790.16.
However, if a person’s net annual income for 2023 was higher than $86,912, they will have to repay part of or the entire OAS pension.
On top of the pension, seniors and their partners may also be eligible for extra benefits such as the Guaranteed Income Supplement, Allowance and the Allowance for the Survivor under the OAS program. These three benefits are non-taxable.
For single, widowed or divorced Canadians aged 65 or older and earning an annual net income of less than $21,768, the maximum GIS payment per month for the July to September period is set for $1,072.93.
The maximum monthly allowance for a surviving spouse or common-law partner aged 60 to 64 years is $1,626.20.
Who is eligible?
To be eligible for the OAS payment, a person must be at least 65 years old.
There are also some eligibility requirements of residency whether the person is living in Canada or in another country.
Employment status is not a requirement.
“You can receive the Old Age Security (OAS) pension even if you have never worked or are still working,” the government states.
In most cases, Canadians are automatically enrolled into the OAS plan when they turn 65.
If they haven’t been enrolled, they can apply online and by paper mail.
The cost of living is forcing many Canadians to delay or reconsider their retirement plans.
A recent survey by Fidelity Investments Canada showed that nearly 60 per cent of Canadian retirees are supporting their adult children financially, which they say is having a negative impact on their own finances.
Earlier this month, the federal government announced that it was planning to expand early retirement eligibility for some kinds of front-line workers.
The legislative changes, which will be introduced in the fall, would allow some front-line workers to retire after 25 years of service without a pension reduction.
The provision is already available to military members, RCMP officers and some correctional workers.
— with files from Global News’ Uday Rana and The Canadian Press.