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How Old Age Security (OAS) Supports Your Retirement Income: Eligibility and Payment Basics

Learn how OAS provides foundational income support for Canadian seniors and where it fits in your retirement plan

The Old Age Security (OAS) program is one of the main pillars of Canada’s retirement income system. Unlike the Canada Pension Plan (CPP), OAS is funded from general tax revenues and is designed to provide a basic, guaranteed income to seniors, regardless of work history.

Understanding how OAS works, who qualifies, and how it integrates with your broader financial strategy is key to effective retirement planning.

What Is the Old Age Security (OAS) Program?

OAS is a monthly payment to eligible Canadian seniors, aimed at providing a modest but reliable source of income in retirement. It complements other sources of retirement income, such as:

  • The Canada Pension Plan (CPP).

  • Workplace pensions.

  • Personal savings (RRSPs, TFSAs, non-registered investments).

Because it’s funded through taxes, OAS eligibility is based on residency, not employment contributions, making it accessible to Canadians who may not have had a long work history or consistent earnings.

Who Is Eligible for OAS?

To qualify for OAS, you must meet these basic criteria:

Requirement Details
Age Must be 65 years or older.
Status Must be a Canadian citizen or legal resident at the time of application.
Residency in Canada Must have lived in Canada for at least 10 years after age 18 (for payments within Canada).
Living outside Canada Stricter requirements apply, but international agreements may allow eligibility.

Optimize helps ensure your residency history is reviewed properly when assessing OAS eligibility.

How OAS Payments Are Determined

The amount of your OAS payment depends on:

  • Your years of Canadian residency after age 18.

  • Whether you meet the full 40-year residency requirement for maximum payments.

  • Payments are indexed quarterly to inflation, preserving their purchasing power.

Note: Unlike CPP, OAS benefits are not based on your earnings history. However, higher-income retirees may face OAS clawbacks (reduction in benefits based on income), which are addressed in a separate planning strategy.

How OAS Fits into Your Retirement Income Plan

OAS serves as a foundational income layer, providing predictable cash flow in retirement. While it won’t cover all living expenses, it helps:

  • Reduce reliance on personal savings for basic needs.

  • Provide stability during market volatility.

  • Support retirees with little or no private pension income.

At Optimize, we ensure OAS is factored into your broader retirement plan, providing a baseline that complements more variable income sources.

How Optimize Helps You Navigate OAS Eligibility and Planning

At Optimize, we help you get the most out of your OAS benefits. We support you by:

  • Assessing your residency history to confirm eligibility.

  • Incorporating OAS payments into your retirement income projections.

  • Coordinating OAS with CPP, RRSP withdrawals, and other income sources for tax-efficient cash flow.

  • Monitoring OAS clawback risks and advising on strategies to minimize benefit reductions.

  • Adjusting your plan over time, as OAS payments and personal circumstances evolve.

With Optimize’s guidance, OAS becomes a secure and integrated part of your retirement income strategy—not just a government benefit to file away.