Capital accumulation plan members saw a slight uptick in their plan outcome in the first quarter of 2024, as annuity rates rebounded to levels comparable to those from the third quarter of 2023 and gross income replacement ratios remained at multi-year highs, according to a new report by Eckler Ltd.
The consultancy’s latest CAP income tracker found a typical male member retiring at the end of March 2024 achieved a gross income replacement ratio of 64.3 per cent and a female member achieved 62.7 per cent.
Read: CAP member outcomes continue to rise in Q2 2023: report
Inflation remained high during the quarter, increasing by 2.9 per cent year over year, and the compounding effect of inflation continued to be the No. 1 concern for pre-retirees and retirees.
The report also noted the rising cost of living has had a significant impact on Canadians’ retirement savings. It cited a recent survey by Ipsos and the Ontario Securities Commission that found a third (33 per cent) of retirees said their monthly expenses in retirement are higher than expected.
In addition, a recent survey by the National Institute on Ageing found nearly 66 per cent of Canadians aged 50 and older said they’re either not in a financial position to retire or are unsure about whether they can afford to retire when they want to, noted the report.