Question about OAS and the Age Credit | Page 2 | General financial discussion | Discussion forum

A couple of other considerations are:

You can backdate your application - I think it's 11 months. While I think you don't get the increment for that period, it does allow you to make the decision at end of year for almost the whole year if you should choose to apply.

Second, we decided that our goal is not to milk every cent we can get out of government programmes, but, rather, to ensure that we have ongoing income that is protected against inflation as much as we can control that.
The older of us took the OAS as soon as it was available, as that seemed to be the prevailing wisdom at the time. The younger one, who is still working part time with irregular income, is postponing, probably until age 70. In the interim we are taking some cash out of RSPs to top up tax bracket. We feel we have more control over income by cashing RSPs as we can adjust the amount annually depending on other income, and it will reduce the ultimate tax burden from that source. Some of the OAS may get clawed back at some point, and it will certainly be taxed, but it will give us some help with inflation and give us a bit more of a cushion in terms of money to deal with any significant health costs in the future as we have decided not to insure for long term care. It will also increase the stability of income. As we age, stability of income will be more important as we won't want to take any risks and may not be well enough to manage our money ourselves. I will say, though, that we seem to be in the minority on this score. Almost everyone we know except those who have 100% clawback has opted to take it at 65 or younger. The main reason for doing so seems to be to "beat the system", to grab what you can while you can as the future is uncertain. We don't feel that way. Our focus is on having enough at every stage. As long as we have enough, we are happy.

We haven't consulted the financial wisdom forum. This is just what we worked out for ourselves, after having thought about it quite a bit. Maybe, if we live to be very old, we will be ahead over time; and maybe, if we don't, we won't. This is not knowable, and it makes little sense to plan based on guessing, even though all our parents have lived to 93+. We don't care as long as we have enough to live on. If one of us is widowed, they may ultimately face a 100% clawback (which sounds like the same situation AltaRed will face), but we don't care about that because it means that person has enough. We also have enough now. So, all is good.

I find it interesting how the people who are most vehemently opposed to what they term "socialism" are often the most keen to take everything they can get in the way of benefits.

As AltaRed indicated, it is by no means certain that everyone who defers will come out ahead. It's a crapshoot, and, thus, speculation about who will benefit is irrelevant and unfounded. The fact that my parents have had long lives only means I am inclined to worry a bit more about being sure to sustain my own for a possible long haul. It is obvious that Top it up didn't really take in the fundamental reasons why we decided to forego a more certain payout in the shorter term and accept the possibility that there would be none at all.

My friend who retired last month and died last Monday at age 68 deferred. He didn't get a penny. 'nuf said.

I'm not going to do your homework, and I have no idea of the details of your financial situations.

We can all complain about something we don't like our taxes going towards. "Socialists" would probably complain about corporate bailouts (less popular than they used to be), tax breaks to individuals for capital gains and Cdn dividends, taxes foregone for TFSAs, and so on. Everyone can go on about things they don't like in a budget. There will be things they benefit from personally and things that help out someone else. Budgets are always compromises between competing needs and interests.

Let's not confuse CPP with OAS. Totally different system, not part of the budget.

Bill said
Top It Up, exactly, there won't be a list, just another unsubstantiated generalized snipe at a hypothetical (but always specific - in this case those, apparently including you, "most vehemently opposed" to socialism) group of people. Ho-hum, just ignore.

If you've taken OAS you've got 6 months to cancel it if you change your mind and decide you do want to defer. Have to pay back what you received.  

Good idea to ignore what I say if you intend to ignore the substance of it.
I'm sure everyone is capable of deciding for themselves, based on their own experience, if they agree with my observations or not.

But, please, be my guest. Ignore me.
Drop the unsubstantiated generalized swipes at specific governments. Don't bait people. Put your energy into providing help to people who ask legitimate questions. And all will be well.

Thanks to 2of3aintbad for doing his/her own homework for clarification, and for reporting back.

Good point too from Bill about being able to rescind your decision. He didn't give a link, but I presume it is mentioned somewhere on government site.

Something else to know is that CRA will adjust your Notice of Assessment if OAS ends up paying you a big lump in one year to reflect some months from a previous year. OAS will send you a slip for whatever they paid out in a given year, but CRA will attribute it to the year that it belongs to. I say this from personal experience.