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Deciding when to take Canada Pension Plan (CPP) and Old Age Security (OAS) benefits (this applies to Social Security in the USA as well) is a crucial financial choice that depends on various factors, including YOUR health, income needs, and long-term financial goals.

Reasons to Take CPP and OAS Early (at 60 or 65)

Need for Immediate Income – If you retire early and require additional cash flow to cover daily expenses, taking CPP and OAS as soon as you qualify can help.

Health Concerns – If you have a shorter life expectancy due to health issues, it may be beneficial to start collecting benefits earlier rather than delaying for a higher payout you may not fully utilize.

Avoiding Investment Risks – If you prefer guaranteed income over investing your savings, taking CPP and OAS early ensures a steady income stream.

Retirement Lifestyle Goals – If you plan to travel or enjoy active retirement years in your 60s, having access to funds earlier can enhance your quality of life.

Reasons to Delay CPP and OAS (to 70)

Higher Monthly Payments – For every year you delay CPP after 65, your benefits increase by 8.4% per year (up to 42% more at 70). OAS also increases by 7.2% per year if delayed to 70.

Tax Efficiency – If you are still working or have other income sources, delaying CPP and OAS can help reduce tax burdens and avoid OAS clawbacks.

Longevity Planning – If you expect to live a long life, delaying benefits ensures a larger guaranteed income in later years, reducing the risk of outliving savings.

Continued Investment Growth – If you have other assets generating income, delaying CPP and OAS allows your investments more time to grow.

Ultimately, the best choice depends on YOUR financial needs, health, and retirement plans. A balanced approach—taking one benefit early while delaying the other—may also be a smart strategy.


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DISCLAIMER *
All advice given is my opinion so please take it for what it's worth. Only you can determine what is best for you. Sharing my experiences and advice is just that, sharing. Hopefully it can help but it might not. Any financial advice I highly suggest talking to a registered financial consultant.