This paper aims at modeling the proposed 5-year rise in retirement age for Russian economy. The primary goal of the paper is to analyze the effect of this pension reform on the major macroeconomic features of the Russian economy as well as benefits and losses of different age group of agents. The problem is solved by making simulations in the setting of a global CGE-OLG model. The proposed model takes into account the long-run demographic trends forecasted by the UN as well as the budget structure of each of the 17 regions included: consumption taxes, income tax, payroll tax, corporate tax and natural revenues and expenditures on education, healthcare, pensions and other spending. Having overlapping generation is the model allows us to estimate changes in welfare of different age groups of agents from any economic policy. The results of the simulations show that the effect of raising the retirement age on economic growth appears to be limited. However, we observe an increase in the level of consumption and welfare for all the generation except for those that are close to reaching the retirement age when the reform is implemented. A more pronounced effect of raising the retirement age is that it helps keeping the government budget balanced in the long run. As an alternative a gradual pension system capitalization scenario is considered.