The future of group retirement is here, and it’s more dynamic and inclusive than ever before.Today we can acknowledge the diverse needs of today’s workforce while providing the structure for long-term financial security..
The Opportunity You May Be Missing
Here’s a startling fact: only 30% of companies that offer benefits plans also have retirement solutions. We are finding that many simply haven’t considered retirement plans because they’re focused on immediate benefits needs.
Breaking Down the “We Can’t Afford It” Myth
One of the most common objections I hear is, “My employees can’t afford to contribute to a retirement plan.” Let’s break it down…
A $40 reduction in take-home pay can result in $100 going into an RRSP when you factor in tax savings and employer matching.
The New Workforce Demands New Solutions
The workforce has changed dramatically. We’re no longer just dealing with traditional retirement planning. In 2023 alone, Canada welcomed over 1.2 million newcomers, and Millennials now make up the largest segment of the workforce. These demographics have different needs and priorities.
With a diverse workforce we can look at flexible options to suit variable needs. Instead of offering just a traditional retirement plan, we can create a flexible program that allows employees to direct their savings toward their most pressing needs – whether that’s student debt repayment, saving for a home, or planning for their children’s education – while still building their retirement savings through employer matching.
The Cost Advantage
Here’s something that really resonates with my CFOs: while benefit plans often see volatile annual increases of 10-14%, group retirement plans offer predictable, fixed costs. In today’s economic environment, this predictability is incredibly valuable. We have heard from CFO’s, “This is the first benefits-related proposal where I can actually predict my costs five years out.”
Making It Work for New Canadians
One of the biggest challenges lately has been designing solutions for companies with many new Canadian employees. These individuals often can’t contribute to an RRSP in their first year due to no previous earned income. The solution? We’ve started implementing non-registered savings programs (such as a Group TFSA) that can transition to registered products over time. It’s about creating that savings habit early, even if we have to start with a different vehicle.
The Education Component Is Critical
The success of any group retirement program hinges on education. But here’s the key: it needs to be targeted. What works for a 45-year-old manager doesn’t resonate with a 25-year-old new graduate. As your advisors we help employers develop communication strategies that speak to different demographic groups within their workforce.
Looking Ahead
The reality is, we’re facing a future where Millennials might live into their 90s, and Generation Z could reach triple digits. This longevity, combined with uncertainty around government retirement benefits, makes planning for the future more critical than ever.
“What makes this different from a traditional retirement plan?”
Instead of the old one-size-fits-all approach, create a flexible design. Imagine being able to tell your employees that you’ll match their financial priorities, whether that’s:
- Paying down student debt
- Saving for a home purchase
- Building an education fund for their children
- Or traditional retirement savings
“But what about the cost? We’re already dealing with increasing benefit premiums…”
You set the matching percentage, and that’s it – no surprises! We can provide benchmarking so you can align to your industry standards (2% vs 4-6%). And then it’s up to the employee to participate. If Employees choose to not max out the Employer match – you come in under budget!
“What about administration? We don’t want to create more work for HR…”
We handle all the heavy lifting. The programs are designed to be simple to administer, and we provide comprehensive education and support.
“This sounds interesting, but what’s the next step?”
We suggest starting with a demographic analysis of your workforce. This will help us design a program that best meets your employees’ needs while aligning with your budget and objectives. We can then create a rollout strategy that includes:
- A customized plan design
- Clear communication materials
- Employee education sessions
- Regular review meetings to track success
“How many Employees do I need to qualify for a plan like this?”
We can start Group RRSP plans as low as 2 Employees! More features are available according to company size and annual contribution rates, but we are here to guide you along the way.
“What kind of timeline are we looking at?”
We could have everything in place within 8-12 weeks. The sooner we start, the sooner your employees can begin benefiting from the program.
Remember, we’re not just talking about retirement anymore – we’re talking about a comprehensive financial wellness program that helps your employees today while building for tomorrow. Would you like to see some specific examples of how this could work for your team? Let’s chat, book in with an advisor today—- Booking link
