As Canadians struggle to save amid the rising cost of living, employers play a crucial role in facilitating savings options for their employees, says Doug Crowe, vice-president of RBC Group Advantage, the Royal Bank of Canada’s group retirement division.
“The first important step employers can make is deciding to sponsor a group savings plan for employees, which many employers in Canada haven’t done yet,” he says, noting more and more employers feel it’s their social responsibility to help employees save and understand the importance of investing. “Along with helping employers support their goals of attraction and retention, starting a group savings plan is a great way to help employees bridge the savings gap — what they’re able to save versus what they need to save.”
A new survey by RBC found three-quarters (77 per cent) of Canadians would like to save more but can’t because of rising costs. The survey, which polled more than 1,500 Canadians, found 64 per cent are concerned about falling behind financially this year and 48 per cent said they’ve never been more stressed out about money.
Read: Survey finds Canadians’ financial well-being continues to decline amid rising inflation
Nearly three-quarters (72 per cent) of those with debt were worried about taking on more debt and the majority were concerned they won’t have enough money to cover unexpected costs (67 per cent) or ongoing expenses (62 per cent).
Employers can help employees feel more financially prepared by making financial wellness part of their overall benefits program and providing accessible financial education services, says Crowe.
“The level of funding an employer provides, as well as plan features selected, play an important role in supporting employee savings, since this has a significant impact on employee participation and how much they’re able to save over time. This may sound complicated for employers, but it really isn’t since . . . numerous consulting services are available throughout the industry in Canada.”
The survey also found 71 per cent of Canadians said a recession would be tougher on everyone today than it was in 2008/09 and 70 per cent said it would negatively impact their own finances. In addition, 53 per cent indicated they’re too concerned about covering current expenses to worry about a recession.
Read: How employers can support employees’ financial, mental well-being during high inflation