Today we discuss the main features of the three Canadian Public Pension Plans: Canada Pension Plan, Old Age Security and Guaranteed Income Supplement.
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Intro (00:00)
CPP Management (1:11)
CPP Contributions (1:54)
CPP Yearly Maximum Pensionable Earnings (2:21)
CPP Enhancement (3:11)
How Much Will You Get from CPP? (3:33)
When to Start Taking CPP (4:49)
CPP Indexing (7:23)
Getting CPP Estimates (7:42)
CPP Child-Rearing Provision (8:15)
CPP Post-Retirement Benefit (8:37)
Additional CPP Benefits (9:05)
OAS: How Much Will You Get? (9:50)
10% OAS Increase at Age 75 (11:04)
OAS Taxability and Indexing (11:20)
OAS Eligibility (12:18)
When to Start Taking OAS (13:08)
OAS Clawback (14:40)
GIS (17:59)
GIS Taxability (19:53)
GIS Allowance (20:00)
GIS Survivor Allowance (20:29)
Outro (20:51)
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Links:
How Stable Are OAS & CPP:
Doug Runchey Article:
Brandon Beavis Investing OAS, CPP & GIS Video:
Parallel Wealth GIS Video:
CPP Investment Board:
CPP (CRA):
OAS (CRA):
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DISCLAIMER: All videos on this channel (including this one) are for educational or entertainment purposes only. They are not (and are not intended to be) financial, investment or legal advice. It is our firm position that everyone has a unique situation and should seek professional advice on how best to navigate it. Rhys Martell is a Chartered Investment Manager (CIM), a Fellow of the Canadian Securities Industry (FCSI), a Qualified Associate Financial Planner (QAFP) and more. However, he is not registered to provide investment advice and, therefore, does not provide specific investment recommendations. Those looking for specific investment advice should seek out a registered professional….(read more)
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KEY Details About Canada’s Government Pensions in 2023: CPP, OAS & GIS | Retirement in Canada
As individuals approach retirement age, they often find themselves navigating the complex world of government pensions in Canada. The Canada Pension Plan (CPP), Old Age Security (OAS), and Guaranteed Income Supplement (GIS) are vital components of the retirement income system in Canada. Understanding the details of these pensions is crucial for retirees, and as we enter 2023, several key details are worth noting.
Canada Pension Plan (CPP)
The CPP is a contributory, earnings-related social insurance program. It provides a foundation of income on which workers can build their retirement income and is designed to replace about 25% of the pre-retirement earnings up to a maximum amount. In 2023, the maximum CPP retirement pension for someone who starts receiving it at age 65 is $1,243.33 per month.
One of the key changes for 2023 is the enhancement of CPP benefits, which began in 2019. This enhancement will gradually increase both employer and employee contributions to the CPP, resulting in higher benefits for future retirees.
Old Age Security (OAS)
The Old Age Security pension is a monthly payment available to most Canadians aged 65 and older who meet the residency requirements. In 2023, the maximum monthly OAS pension amount is $649.07. There have been no major changes to the OAS pension for 2023, but it’s important to note the annual indexing of OAS benefits. OAS benefits are indexed to the Consumer Price Index and are adjusted quarterly in January, April, July, and October.
Guaranteed Income Supplement (GIS)
The GIS is a non-taxable benefit available to low-income Old Age Security pensioners. It provides additional support to low-income seniors living in Canada who receive OAS benefits. The maximum monthly GIS amount for a single, widowed, or surviving partner is $919.12, while for a couple (each receiving OAS), it is $608.44. There are no significant changes to the GIS in 2023, but it’s important for low-income seniors to be aware of their eligibility for this additional financial support.
Other Considerations
It’s worth noting that all these pension benefits are subject to income tax. Individuals who have a higher income in retirement may see a portion of their OAS pension, and potentially GIS benefits, clawed back due to the OAS pension recovery tax, and GIS clawback.
Additionally, when planning for retirement, individuals should consider the various retirement savings options available, such as Registered Retirement Savings Plans (RRSPs) and Tax-Free Savings Accounts (TFSAs). These savings vehicles can supplement government pensions to provide a more comfortable retirement income.
In conclusion, as we enter 2023, understanding the key details about Canada’s government pensions – the CPP, OAS, and GIS – is essential for those approaching retirement age. By staying informed about the amounts of these pensions, possible changes, and eligibility criteria, retirees can better plan for their financial future. Consulting with a financial advisor can also provide personalized guidance on retirement income planning in Canada.
If you do not start your CPP and pass away – does your benefit automatically go to your partner or child?
Nice video, but still have lots of questions. Will ask one or two. I am currently living common law, and my spouse older than me is already collecting OAS and some GIS supplement at the moment. Her application was automatic where I have to do a paper application.
1. I understand the GIS is based on both our incomes. Can one spouse apply and the other not apply and have the GIS portion if applicable go to one spouse and not the other or must both spouses apply on the application separately for GIS.
2. What happens if we do not wish to apply, or cancel the GIS, can you re-apply later? As in you legally separate, in the future?
3. If you collect GIS, and then at some point in the future you no longer qualify because of increased income, work income, RRIFs , if you have to repay back the overpayment of GIS, will interest be added to the payment ? Cheers
I don’t think I will live to be old. I would consider taking my CPP at 60, if I get there!!
Yes this person is doing a very good job explaining everything for sure.
Yes that’s our government they give you money n then they tax you on it tell me does that make sense? I don’t think so?
How do i contact your office
No wonder why my grandpa put his money under the mattress !! hahaha
If you delay OAS, will you get both the deferral increase and the residency increase? Example – you have 36 years residency at age 65. You start OAS at age 69. Will get the deferral increase based on 36 or 40 years residency? Will you get residency increase to 40 thereby the max OAS plus the deferral?
if you are expecting a large capital gain income (say by selling a secondary property) and you have RRSP room wouldn't it make sense to put as much of the income into the RRSP to defer the tax? That is until you are 71.
Thx Like 3.9K+
Knowing the majority of people will not earn the YMPE amount. Why do retirement planners make videos based on that amount? The average Canadian earns just under $60k. While the median is slightly above $40k. Myself and the majority of Canadians will receive 60% of our CPP if we work and wait until 65. Why doesn’t retirement planners focus on low income retirees? They’re the ones who REALLY needs the help.
What do yoy think of alberta creating its own plan?
Why the bank provided the form Т5008 with only the market cost of some shares, moved IN-Kind transaction, from my Non-registered account to my TFSA account? This market cost went to my income and I had an OAS clawback. The both boxes of that form had to be filled: with a market cost of those shares and the Base Cost (ABC), so the Proceeds supposed to be a difference of those two cost. It could be a Gain or a Loss, depends which cost: the market cost of the time of the In-Kind transaction and the ABC – is more. The previous year the bank had input in the firm the Base Cost amount, but not in the last year.
Appreciate all the knowledge sharing
I'm confused about the GIS. Age 60 to 64.
Great knowledge. Thanks for this video.
DEPRESING !!!!
Hi! My Husband and I are common-law and are having alot of issues getting his GIS application approved. We really need the retro active payments for the last two years since he retired! We would be very happy to be able to speak to you and see if you have any advice for us! Thank you!
If Alberta leavess CPP does the "tank" become a 1974 AMC Gremlin?
no valid delay, will hit you
Please pay attention: no support cause retroactive, I don't have much than 18000.00, however retroactive payment put me at 40000. No longer qualified for Seniors Benefits
Delaying beyond 65, hurts, here in Canada, upon tax assessment because of retroactive income is beyond 40000, no longer supported by Seniors supports
I never received my Fathers survivor benefit. What can I do
The $2500 death benefit is ridiculously low what a rip off scam
After the age of 65 any money taken out of my RRIF will clawback my GIS. Can I apply the 2000 dollar pension income tax credit to prevent the first 2000 dollars of RRSP withdrawal from being clawbacked from my GIS???
I thank you so much I reall need some advice in this cpp, old age and help supplements. Am a widow age 70 I did collet my cpp and oa when am 68. So am planning to retire this Dec. What shod I do next. Thank you
Pls do a segment on what would happen if Alberta leaves with their portion. Of the CPP
The best explanation! Thanks for sharing it.
What happens to CPP contributions made by foreign workers who end up going back to their countries? Do they have to apply for it when they are 60 – 65?
Thank you for this informtaive video. Question regarding OAS… I am 65 and have lived in Canada for 10 years. Will I get the full OAS benefit if I worked for more than 30 years from a country where Canada has an agreement with? Thank you.
Great vid; only one detail, if you don't have the max years for CPP and stop working just take it, as the low years grace may not work with the calculation.
I wanted to live in Pakistan because the cost of living is considerably low in that country,but I was told that I will not get the same amount of money if I moved there. The CPP an the Allowance wil be reduced. If you could explain that to me i will be much obliged. By how much my monthly payments will be reduced?
Thank you very much for what you do ,i am 66 i apply and get the CPP but the OAS and GIS i did not get it i apply for the OAS about 3 month ago still did not get the resut yet so i dopnt known what to do ,i known you are busy but it you has a spare time can you give the advice what to do i came to Canada on September of 1989 and 1 month later go to work till now so i dont known why i can not get that , i work just for minimum wage so i did not made too much ,about 25 or 27.000 a year thank
If Cpp only $200 not good enough for retirement
Could you do a video on other pension plans, such as Saskatchewan pension plan. Are there any other pension plans that anybody can join?
Great vid and thanks!! Question in regards to GIS. When applying for gis they say to take total income line from your tax return. This amount includes your OAS. However OAS amount is not supposed to be included in determining how much you will be receiving in GIS. So how can they accurately determine your GIS if using the total income line on ur tax return?
Many thanks if you can clear this issue for me 🙂
I wished I new that information twenty years ago. Thanks for your descriptiveness.
Only if you get max benefits or it's amount are very Operated for most of us