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As retirees navigate their golden years, financial stability becomes paramount. One significant aspect of this stability is maximizing government benefits, including Old Age Security (OAS). However, the OAS clawback, particularly in 2024, presents challenges for seniors seeking to optimize their income. In this article, we'll explore strategies to navigate the OAS clawback effectively while ensuring financial well-being in retirement.

Understanding the OAS Clawback in 2024

What is OAS Clawback?

The OAS clawback, or the OAS Recovery Tax, is a mechanism designed to recover part or all of the OAS pension from higher-income seniors. For the year 2024, the clawback threshold is $79,845. Seniors with income exceeding this threshold may see a reduction or complete elimination of their OAS benefits.

Implications for Seniors

The OAS clawback affects seniors differently based on their income levels. For those with substantial retirement savings or pension income, it could result in a significant reduction in their OAS benefits. Understanding how the clawback works is crucial for seniors to proactively manage their finances.

Strategies to Optimize OAS Benefits

1. Income Splitting

One effective strategy for reducing the impact of the OAS clawback is income splitting. This involves transferring income from one spouse to another to equalize their income levels. By doing so, couples can potentially keep their combined income below the clawback threshold, preserving more of their OAS benefits.

2. Tax-Efficient Investments

Investing in tax-efficient vehicles such as Tax-Free Savings Accounts (TFSA) or dividend-paying stocks can help minimize taxable income. By strategically allocating assets across different accounts, seniors can manage their income in a way that reduces the clawback while still generating returns.

3. Delaying OAS Benefits

Delaying the receipt of OAS benefits can be advantageous for seniors with higher income levels. For each month OAS benefits are delayed after the age of 65, the pension amount increases by 0.6%. By deferring OAS until a later age, seniors can potentially reduce the impact of the clawback when they have lower income from other sources.

4. Pension Income Splitting

Similar to income splitting between spouses, pension income splitting allows eligible seniors to split eligible pension income with their spouse for tax purposes. This strategy can help equalize income levels and mitigate the impact of the OAS clawback.

Bellwether Family Wealth's Perspective

According to Dan Beyaert, a financial advisor at Bellwether Family Wealth, navigating the OAS clawback requires careful planning and consideration of individual circumstances. “We work closely with our clients to develop personalized strategies that optimize their retirement income while minimizing the impact of government benefit clawbacks,” says Beyaert. “By leveraging various financial tools and tax-efficient investments, seniors can achieve greater financial security in retirement.”


Navigating the OAS clawback in 2024 requires strategic planning and proactive measures. By employing strategies such as income splitting, tax-efficient investments, and delaying OAS benefits, seniors can optimize their retirement income while minimizing the impact of clawbacks. Consulting with financial advisors like Dan Beyaert at Bellwether Family Wealth can provide personalized guidance tailored to individual financial goals and circumstances.

Frequently Asked Questions (FAQs)

1. How is the OAS clawback calculated?

The OAS clawback is calculated based on a senior's net income for the previous year. If their income exceeds the threshold set by the government, a portion or all of their OAS benefits may be subject to clawback.

2. Can I appeal the OAS clawback decision?

Yes, seniors have the right to appeal the decision if they believe there are errors or extenuating circumstances affecting their income levels. It's advisable to seek assistance from a financial advisor or tax professional when appealing a clawback decision.

3. Are there any exemptions to the OAS clawback?

Certain types of income, such as Guaranteed Income Supplement (GIS) and certain disability benefits, are not included in the calculation for the OAS clawback. However, most other forms of income, including employment earnings, pensions, and investment income, are considered.

4. How often is the OAS clawback threshold adjusted?

The OAS clawback threshold is adjusted annually to account for inflation and changes in the cost of living. It's important for seniors to stay informed about these adjustments to effectively plan their finances.

5. Can I still receive OAS benefits if I'm subject to the clawback?

Yes, even if you're subject to the OAS clawback, you may still receive a portion of your OAS benefits depending on your income level. However, the amount you receive will be reduced based on the clawback calculation.

By addressing these common questions and implementing tailored strategies, seniors can navigate the OAS clawback with confidence and secure their financial well-being in retirement.


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