CPP and OAS Payment Increase July 2024, Expected CPP and OAS Pension Boost

You should consider reading this post for a detailed explanation of Pension Boost Canada: Expected CPP and OAS Pension Increase in July 2024.

Pension Boost Canada

The Canadian government offers several programs to address the main concerns of retirees: health and pensions. Your payments under the Old Age Security (OAS) and Canada Pension Plan (CPP) are indexed annually to account for inflation and cost of living increases.

Starting in January 2024, there will be a 4.8% rise in your pension. All pensioners, survivor pensions, and the deferred pensions of former and divested members are subject to this yearly cost of living adjustment (COLA). Statistics Canada reports the Consumer Price Index (CPI) every January, which measures the rise in the cost of living and is used to calculate pensions.

Pension Boost Canada ensures that your pension does not depreciate over time and shields it from the effects of inflation. We recommend reading this post to get complete details about the upcoming increase in CPP and OAS pension amounts.

CPP and OAS Payment Increase

Expected CPP and OAS Pension Increase in July 2024

CPP Pension Increase 2024

Many modifications are being made to the CPP pension, which will take effect next year and affect both employed Canadians and pensioners. From 2023 to 2024, CPP benefits increased by 4.4%. Due to significant inflation over the past 12 months, this increase is larger than in prior years.

In 2024, the maximum monthly CPP payout will be $1,364.60, up from $1,306.57 in 2023, due to the average 4.4% rise in CPI rates. The average monthly CPP payout in 2024 will be $758.32. Canadians who are still employed will see the effect of the income cap increase from $66,000 to $68,500.

A “second additional CPP contribution,” or CPP2, is also being introduced by the government. It is set above the highest pensionable income threshold. For retirees, the benefit will be minimal.

OAS Pension Increase 2024

OAS benefits have increased by 0.80% for the quarter ending in January–July 2024. Unlike CPP, OAS payments are adjusted quarterly for cost of living increases in January, April, July, and October. The current 2024 increase in OAS is calculated using CPI data for two periods of three months each.

A 0.8% increase in the CPI will result in the maximum monthly OAS payments for January through July 2024 being $713.34 (for those 65 to 74 years old) and $784.67 (for those 75 years and above). Benefits automatically increased by 10% for seniors 75 years or older as of July 2022.

This increase will continue until 2024. Seniors over 65 currently receive a maximum monthly OAS payout of $784.67, which is 9% more than those aged 65 to 74, who receive $713.34.

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Concluding Words

The OAS and CPP pension provide financial help to older Canadians, forming an important part of their retirement income. These pensions ensure a fair distribution based on financial needs, adapting to individual income levels and inflation.

The purpose of Pension Boost Canada financing is to reduce financial pressures on seniors and allow them to maintain their standard of living. Planning before retirement age is wise, as personal retirement savings can only partially fill the gap between pension and expenses, and are also susceptible to inflation.

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