The Canadian Institute of Actuaries is supporting employers with a new resource that focuses on the importance of early and proactive retirement planning.
The resource covers several topics, such as how to build emergency funds while balancing short-term obligations with long-term goals, as well as developing sustainable retirement income strategies using personal savings, employer-sponsored retirement plans and government programs and maximizing Canada/Quebec Pension Plan benefits and old-age security.
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Dominik Briault, vice-president of actuarial services at consultancy Feigelsohn Kellar, says the resource was based on the findings of a 2020 CIA survey that polled more than 1,500 Canadians on their knowledge of retirement planning.
“[The study] found a very interesting trend — people’s confidence in their own financial future is very different if they work with a financial planner versus if they don’t. Part of the reason for the [CIA’s] statement was to put an actuarial spin on it — what are the risks at retirement? — and secondly, to give them the comfort that [financial planning] is actually going to work over the long term.”
While small- and medium-sized employers are less likely than their larger counterparts to offer financial counselling through their benefits plans, smaller companies that sponsor employee retirement plans can turn to their plan provider to fill that gap.
“My spouse’s employer had a defined contribution retirement plan that was offered through a bank and it was an opportunity for that advisor to also look at the overall [retirement] picture for this person and give some information,” he explains. “In my mind, there is some good that can come out of that.”
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While the 2020 survey didn’t specifically ask Canadians about the impact of the coronavirus pandemic on their retirement savings, Briault notes the health crisis was evident in many of the responses.
“We saw it in people’s feelings about their current financial circumstances. We saw it when people answered what they thought their life expectancy would be — everybody always seemed to be on the shorter end in that survey. I don’t know if that’s just a perception of people not understanding what longevity actually is, versus people feeling grim about the perspective of what longevity could be, but we saw those results in there.
“[Life expectancy] was another topic that came out of the survey that we wanted to address in that statement, specifically what life expectancy actually means, because it’s an important data point that people are using for [retirement planning].”
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