In 2025, Canadian seniors are experiencing one of the most generous pension increases in recent years. Thanks to federal cost-of-living adjustments and continued enhancements to the Canada Pension Plan (CPP) and Old Age Security (OAS), retirees are seeing a meaningful rise in their monthly payments. This update comes as part of Canada’s broader commitment to supporting its aging population amid inflation and rising living costs.
CPP Payments Grow with Contribution Enhancements
The Canada Pension Plan has undergone gradual enhancement since 2019, and 2025 represents a critical milestone in that journey. The federal government continues to phase in higher contribution rates to fund future retirement security. As a result, retirees who contributed more during their working years are now beginning to reap the benefits.
For 2025, the maximum monthly CPP benefit for new beneficiaries aged 65 has increased to approximately $1,364.60. This is up from $1,306.57 in 2024. Those who delay retirement until age 70 may receive up to 42% more than the standard amount, rewarding seniors for deferring their claims. These increases ensure that pension benefits keep pace with the rising cost of essentials such as housing, groceries, and healthcare.
OAS Payments Increase for All Seniors 65 and Over
Old Age Security also saw a substantial increase in 2025. The federal government adjusts OAS quarterly based on inflation, using the Consumer Price Index. In January and July 2025, OAS payments were both increased, ensuring that the monthly pension reflects the true cost of living. Seniors aged 65 to 74 now receive a maximum of $713.34 per month, while those aged 75 and older continue to receive an enhanced benefit, approximately $784.67 monthly.
This difference in OAS rates for seniors over 75 is part of a policy introduced in 2022, aimed at recognizing the increased financial vulnerabilities older seniors may face, such as higher healthcare costs and limited earning potential.
Combined Monthly Income Reaches New Highs
For eligible retirees receiving both CPP and OAS, 2025 marks a record high in combined monthly pension income. The new rates have significantly raised the financial baseline for many seniors.
| Benefit | Monthly Amount (2025) |
|---|---|
| CPP (at age 65) | $1,364.60 |
| OAS (ages 65–74) | $713.34 |
| OAS (ages 75+) | $784.67 |
| Combined Total (65–74) | $2,077.94 |
| Combined Total (75+) | $2,149.27 |
These figures represent maximum benefits. Many retirees receive lower amounts depending on their contribution history, years of residency, and income levels. However, with the addition of other support programs such as the Guaranteed Income Supplement (GIS), total monthly retirement income can climb even higher, especially for lower-income seniors.
Why the Increases Matter in 2025
These 2025 pension increases are timely. The Bank of Canada’s interest rate adjustments and elevated inflation have placed financial pressure on many seniors, especially those with limited private savings. Rising rents, prescription drug costs, and food prices have outpaced older fixed incomes. The pension increases offer direct relief and help maintain seniors’ purchasing power.
In addition, the government’s emphasis on indexing OAS quarterly, rather than annually, means adjustments can happen faster in response to economic changes. This move reflects growing awareness of the financial vulnerabilities many older Canadians face.
Next Steps for Seniors
Seniors receiving CPP and OAS do not need to reapply for these increases. Payments are adjusted automatically and deposited on scheduled government payment dates. Retirees are advised to check their My Service Canada Account regularly for updates, review their payment history, and ensure their direct deposit details are current.
For those approaching retirement age, early planning remains essential. Deciding when to begin CPP or OAS can have lasting impacts on monthly income. Delaying CPP beyond age 65 can increase monthly payments, while applying for OAS at the right time ensures full eligibility and access to potential GIS benefits.