*Please note that Seasons Retirement does not have any afflation with this program. Please call 1-800-277-9914 or visit the government of Canada website for enquiries or more details.
After retirement, older adults in Canada may find their means of income limited. To supplement this, several government benefits for seniors exist.
Depending on individual needs, the amount of money required for an enjoyable retirement can vary. Generally, more than 70% of pre-retirement income should be enough to afford older adults comfort in retirement.
This rule also applies to people who retire early from work (check out early retirement benefits). Those who retire early can enjoy a fun-filled life in some of Canada’s best places to retire.
As Seasons Retirement prioritizes the financial security of its residents, this article is meant to inform older persons and their family members on the several Canadian government benefits for seniors.
The federal government offers three major benefits and pensions:
The CPP and OAS correspond to a person’s total income in retirement, covering about 40% of their retirement fund. They are, therefore, the first and second pillars of Canada’s retirement income system.
Let’s delve deeper into these Canadian government benefits for seniors and discuss them in detail.
The CPP was first introduced in 1966. A person is only eligible to receive CPP payments if they made contributions during their working period at the rate stipulated by the government each year.
This is a contributory program you can claim in your later years, starting from age 60 onwards.
Even though you may start claiming your CPP at 60, you’ll only receive the full benefits of the pension plan at age 65 and above. This allows older adults who delay their CPP benefits claim for up to five years to receive higher monthly benefits.
The CPP pension benefits are only open to those who have worked in Canada and have contributed to it at least once.
The amount of CPP pension you’re entitled to largely depends on the number of years you’ve worked and contributed, the amount of money you and your employer contributed, and the age you intend to claim your CPP pension.
CPP benefit amounts are reviewed annually to include inflation. The maximum CPP benefit at the moment is $1,253.59 monthly.
The CPP retirement pension also provides a few other benefits to older adults, including:
Suppose, as an older person receiving the CPP pension benefits, you decide to continue working and contributing to the retirement plan instead of retiring. In this case, you’ll be entitled to an increase in your monthly CPP pension.
PRB allows you to work between 60 to 70 years and contribute to the CPP to earn a post-retirement benefit. However, after the age of 70, you won’t be able to contribute further to your CPP.
As the name implies, this CPP benefit is paid monthly to the survivor, who is the partner or spouse of a late CPP contributor. The amount you’re entitled to is primarily based on your age, the other benefits you’re receiving, and the amount contributed to the program.
The maximum monthly CPP survivor’s pension is $674.79 (below age 65) and $752.15 (above age 65).
This CPP death benefit is a one-off payment given to the estate of a CPP contributor after they have passed away. The maximum CPP death benefit is $2,500.
Do you wonder how you can qualify for senior citizen benefits in Canada if you haven’t worked or lived long in the country?
This pension benefit covers older persons in Canada who have lived and worked in other countries. Older adults in this category can process and receive their pension benefits in Canada if a security agreement binds Canada and their residing country.
You can reach out to Service Canada for more information if you’re unsure how to begin receiving this benefit.
Old age security was first brought to practice in 1927 before being revised in 1951. OAS is a monthly benefit given to older adults aged 65 and above who are either citizens or legal residents of Canada.
Unlike the CPP, OAS requires no prior working history or contributions to a plan. The only requirement is that you must have lived in Canada for a minimum of ten years as an adult.
The amount of OAS benefit you’re entitled to is divided proportionally according to the length of time you have lived in Canada after the age of 18. You become eligible for the maximum OAS amount when you have lived in Canada for more than 40 years since becoming an adult.
For example, if you’ve resided in Canada for only 20 years before turning 65, then you’ll be entitled to only half of the entire OAS pension. Currently, the maximum OAS benefit is $642.25 per month.
Note that OAS benefit amounts are revised quarterly to keep up with inflation. To be entitled to a higher amount, older adults may delay receiving OAS benefits for up to 5 years.
As part of Canada’s federal budget, retirees will receive a benefit boost. Older adults 75 years or above can expect a permanent 10% increase in OAS benefits beginning in July 2022.
The GIS is similar to the OAS program but with slight differences. It’s a bonus payment obtainable by low-income Canadian retirees.
Your eligibility for the GIS largely depends on certain factors. You must be a resident in Canada, already be a beneficiary of OAS, and your annual income must be under the minimum income stipulated by the government.
If you have a spouse, your eligibility will be based on your combined income.
Just like OAS, benefits are reviewed every quarter of the year. Furthermore, GIS payments are not taxed.
The maximum GIS benefits for a single, divorced, or widowed older adult is $959.26 per month, $577.43 per month if your spouse receives the full OAS benefits and $959.26 if your spouse does not get OAS benefits.
As part of Ontario’s provincial budget, older adults can expect expanded access to the Ontario Guaranteed Annual Income System (GAINS). Between the 1st of January 2022 and 31st of March 2022, income levels for single pensioners will be $20,214.12 annually and $15,632.16 per annum (per person) for qualified couples.
Other government benefits for seniors include:
OAS offers this Allowance benefit to low-income Canadian retirees every month. The older adults entitled to this benefit must be within the age range of 60-65 years, and their spouse must be a beneficiary of OAS and GIS.
Note that Allowance payments are short-term benefits paid monthly until you qualify for OAS.
The Allowance you receive is calculated based on your combined income with your spouse’s. At the moment, the maximum monthly Allowance benefit is $1,219.68.
Like the Allowance benefit, Allowance for the Survivor is a benefit paid monthly to low-income seniors within the age range of 60 and 64 years whose spouses have passed away.
The maximum Allowance for the Survivor amount is currently $1,453.93, and the benefit is discontinued once you reach the age of 65.
These Canadian government benefits for seniors offer complementary and supplementary benefits for older persons in Canada.
These benefits will enable older adults to live a more comfortable retirement life without worrying about finances.
Older adults searching for retirement residences can find a place of peace, comfort, and livelihood at Seasons Retirement Communities.