As we head into 2025, Canadian seniors are facing rising living costs, and news of a proposed $2,350 increase to the Old Age Security (OAS) program has brought a sense of hope. This article explores the details of the potential OAS boost, the eligibility requirements, payment schedules, and practical strategies to ensure seniors receive the maximum benefit.
What is Old Age Security (OAS)?
The Old Age Security (OAS) is a government-funded pension that provides monthly payments to Canadians aged 65 and older. Unlike the Canada Pension Plan (CPP), which is based on individual work contributions, the OAS is funded through general tax revenue and is available to all eligible seniors.
The amount you receive is largely determined by your residency history. To qualify for the full OAS, you must have lived in Canada for at least 40 years. If you have lived in Canada for 10 to 39 years, you may be eligible for a partial payment.
The OAS program aims to ensure that all seniors have a basic level of financial security, especially for those without substantial workplace pensions or retirement savings. By supplementing other sources of income, OAS helps combat poverty and supports a more secure retirement for older Canadians.
Understanding the $2,350 OAS Increase in 2025
In late 2024, there were talks about a one-time increase to the OAS benefits, possibly as high as $2,350, to help seniors deal with rising inflation and cost-of-living pressures. Although this proposal hasn’t been officially confirmed, it aligns with previous efforts to support seniors financially.
The motivation behind such an increase is clear: as the cost of essentials like food, housing, and healthcare continue to rise, many seniors are finding their fixed incomes insufficient. A one-time boost would help ensure they can meet their basic needs without falling into financial hardship.
Current OAS Payment Details for 2025
As of 2025, the regular OAS payment amounts are:
- Seniors aged 65-74: $727.67 per month
- Seniors aged 75 and older: $800.44 per month (reflecting a 10% increase for those over 75, introduced in July 2022)
These payments are adjusted quarterly to keep pace with inflation, ensuring that seniors can maintain their purchasing power despite rising living costs.
If you can afford to delay your OAS payments, you may choose to defer them for up to five years. By doing so, your monthly payment will increase by 0.6% for each month you defer, potentially giving you a 36% higher amount if you wait until you turn 70 to start receiving it.
Who Qualifies for the $2,350 OAS Increase?
To be eligible for the proposed $2,350 increase in 2025, you must meet the following criteria:
- Age: Be 65 years or older in 2025.
- Residency: Be a Canadian citizen or legal resident.
- Income: Have an annual net income below certain thresholds. In 2025, these thresholds are:
- $148,451 for those aged 65-74
- $154,196 for those aged 75 and older
Seniors with income exceeding these limits may be subject to an OAS clawback, which reduces the amount of financial support they receive. This clawback is based on the OAS Recovery Tax, designed to ensure that higher-income seniors do not receive unnecessary support.
It’s also important to note that you can qualify for OAS even if you are living abroad, provided you meet the residency requirements or have an international agreement in place with Canada. However, taxes may apply to your payments if you reside outside the country.
How to Apply for OAS
If you’re nearing retirement or have not yet applied for OAS, here’s how to get started: