Amara Miller thought her retirement plan was simple: Winters in Guyana with her siblings, and summers in Toronto with her kids and grandkids. You know, that whole back-and-forth thing that some people talk about like it’s just a normal commute.
“I thought once I hit retirement age, I’d just be able to travel freely,” Amara says. Born in Jamaica, her family moved to Guyana when she was 13; at 41, she moved again, this time to Toronto. Now 65, Amara has spent the past 24 years raising her children in Canada, working 12-hour shifts in long-term care homes, and paying into Canada’s system.
But catching up with a friend near Trinity Bellwoods Park one day, the conversation drifted to retirement, and the friend mentioned something about Canada's Old Age Security pension that didn’t sit right with Amara. She went home and pulled out the paperwork, and what she found stopped her cold: yes, collecting her pension while living in Canada took 10 years of residency. But if she wanted to keep receiving her OAS pension when she went to Guyana, she'd need 20 years of Canadian residency, and she needed to make sure she could meet the requirements.
How OAS actually works
To collect Old Age Security while living in Canada, you need to be at least 65 years old, first of all. Unlike the Canada Pension Plan, there's no option to receive it early (though you can defer OAS payments until age 70, so your monthly payments are higher). Clear that bar, and you'll find another one: you also need to have a minimum of 10 years of Canadian residency after turning 18. It's calculated based on a 40-year scale, and every year spent in the country will earn you one-fortieth of the full OAS benefit. So if you’ve been here 40 years, you'll get the maximum cheque every month; if you’ve only been here 10, you get a quarter of that. As long as you remain in Canada, that cheque shows up every month, no questions asked.
But if you want to take that pension abroad with you, Service Canada draws a hard line: you need 20 years of residency in Canada for that, period. There’s no partial consideration, so if you fall short by even a few months, your OAS payments will stop six months after the month you leave Canada. (Not for everyone, though: some countries have social security agreements with Canada that help with this – more on that later.)
Amara hadn’t even added her time up before the dread set in. “Your stomach just drops," she says. “My entire future was decided by whether I landed in Toronto in June or October 20 years ago."
Kelley Keehn, author of Save Yourself and CEO of Money Wise Institute, says that panic is a predictable result of how the OAS rules were written.
"Retirement income works best when it's predictable," she says. "When a benefit drops from something to nothing based on a residency threshold, it creates uncertainty that can disproportionately affect immigrants who arrive later in life." For many families, she adds, this means delaying retirement or burning through emergency savings, just for the privilege of keeping their income if they retire abroad.
What "almost" actually costs
Fortunately for Amara, the calendar worked in her favour – she was well past the line by retirement with 24 years of Canadian residency. As a result, she receives her OAS benefit every month, whether she's shovelling her Toronto driveway in February or relaxing on her sister's Georgetown porch in August.
But someone who misses the threshold can't take their OAS abroad until they've put in the full 20 years, and the cost of that depends on how big a miss it was. A few weeks or months, and waiting it out isn't much of an imposition; a year or more, though, and they're stuck in Canada, pushing back retirement plans. Nineteen years of residency is more than enough to collect OAS in Canada, good for just under half the full benefit, but if they move abroad, they'll get none of it.
The 20-year export rule is a relic of the 1970s, when the federal government locked the OAS framework into place. The criteria treat immigration as a one-way, permanent move, and don't account much for international, jet-setting retirement plans.
The exception that doesn't help everyone
Tammy Schirle, professor of economics at Wilfrid Laurier University and editor of Canadian Public Policy, says OAS works a bit differently than most people assume. “Whether 20 years of social contribution is sufficient or not is really a matter of opinion," Schirle says. "Making this more difficult to assess, of course, is that our social security agreements with countries around the world will account for residency in multiple countries and coordinate pension payments.”
In simpler terms, Canada has bilateral treaties with dozens of countries that let time spent abroad count toward the 20-year mark. That includes several Caribbean countries, so if Amara had stayed in Jamaica past 18 and built her adult life there before moving to Canada at 41, her Jamaican residency could have counted toward the 20-year threshold. But since Amara’s actual journey took her to Guyana first, and Guyana has no such treaty with Canada, she couldn’t take advantage of that workaround. As Schirle puts it: “Collecting a pension after working across multiple countries is just complicated, plain and simple.”
Beyond Amara
Amara’s time in Canada was enough for her to meet the requirements, but she still keeps that folder of documents in her dresser drawer, just in case. And not everyone can cross the threshold. According to Statistics Canada, 46% of racialized Canadians aged 65 and older were born outside the country, with 45% of them immigrating between the ages of 25 and 44. That's peak working age, and it doesn't leave a ton room to bank 20 years before retirement, especially for a population that already experiences poverty at roughly double the rate of their peers. The Guaranteed Income Supplement, which tops up OAS for low-income seniors, is even less portable: it stops after six months outside Canada regardless of how long someone has lived here, with no workarounds at all. The OAS benefit is meant to help support Canada’s aging population, but for immigrants, the program is leaving many out in the cold.
