For decades, 65 was the golden retirement age in Canada. Workers would finish their careers, collect Old Age Security (OAS) and the Canada Pension Plan (CPP), and enjoy their retirement years.
But in 2025, that traditional timeline is being reshaped. With Canadians living longer, facing higher costs of living, and new pension incentives, the age of 65 is no longer a guaranteed retirement milestone.
Instead, more Canadians are extending their working years, delaying benefits, or redefining what “retirement” really means. The shift affects everyone planning for their financial future.
Why Retiring at 65 Is Changing
Several factors have made 65 less of a hard rule for retirement:
- Longer Life Expectancy – The average Canadian now lives into their mid-80s, which means retirement could stretch for 25–30 years.
- Rising Living Costs – Housing, groceries, and utilities continue to increase, straining retirement savings.
- Stronger Incentives to Delay – The government has built in higher payouts for Canadians who wait until 70 to collect OAS or CPP.
With these changes, more Canadians are realizing that retirement is a flexible timeline, not a fixed date.
How CPP and OAS Timing Affects Your Payments
Both OAS and CPP allow Canadians to start earlier or later, but the financial impact is significant.
| Age You Start | CPP Monthly Amount | Change vs. Age 65 | OAS Monthly Amount | Change vs. Age 65 |
|---|---|---|---|---|
| 60 | Reduced by -36% | Penalty applies | Not Available | N/A |
| 65 | Base Amount | 0% | Base Amount | 0% |
| 70 | Increased by +42% | Boosted payments | Increased by +36% | Higher payout |
Exact amounts depend on personal contribution history and government-set rates.
This structure makes it clear: waiting until 70 can dramatically increase monthly benefits if you can afford the delay.
Could Canada Raise the Retirement Age?
In 2012, Canada proposed raising the Old Age Security age to 67, but the plan was scrapped in 2016. Still, the financial math hasn’t changed. With fewer workers paying into the system and more retirees drawing benefits, experts warn the retirement age could be raised again in the future.
Other countries, such as the U.S., U.K., and Australia, have already taken this step. If budget pressures continue to mount, Canadians may eventually see the eligibility age for Old Age Security pushed higher than 65.
Working Past 65 – The New Normal
Retirement isn’t always a complete stop anymore. Two decades ago, only about 10% of Canadians over 65 were still in the workforce. Today, nearly 20% continue working, whether full-time or part-time.
Reasons go beyond money: many value social connections, structure, and purpose that work provides. For others, it’s about staying active or easing into retirement gradually, like using a dimmer switch rather than an on/off button.
Retirement Is Personal—Not Just a Birthday
Ultimately, the decision of when to retire depends less on age and more on personal financial readiness. Canadians should consider:
- Do I have enough savings and investments?
- Can I afford 20–30 years without employment income?
- Would working longer improve my quality of life later?
Some Canadians will choose early retirement with a leaner lifestyle, while others will work into their 70s for security and comfort. The key is to treat retirement as a personal timeline, not a calendar deadline.
The idea of retiring at 65 is no longer guaranteed. With longer lifespans, rising costs, and pension incentives to delay benefits, Canadians must rethink how and when they retire. Starting CPP or OAS early reduces payouts, but waiting until 70 can significantly increase monthly benefits.
Retirement in 2025 and beyond is less about a set age and more about financial planning, lifestyle choices, and personal goals. By preparing now, Canadians can retire on their own terms—whether that’s at 60, 65, or 70+.
FAQs
While 65 remains the base, delaying to 70 boosts CPP by 42% and Old Age Security by 36%, making later retirement more beneficial.
Yes. Canadians can retire at 65, but financial pressures and incentives make working longer increasingly common.
Yes, it’s possible. With rising costs and an aging population, Canada may eventually raise the Old Age Security eligibility age beyond 65.