The Quebec government is introducing voluntary retirement savings plans (VRSPs), a retirement savings tool targeted to employees of small and medium-sized enterprises and the self-employed.
VRSPs are expected to benefit Quebec workers by providing a plan structure to pool smaller employers' assets to allow these plans to benefit from economies of scale.
All companies with at least five employees and that do not already offer a pension plan will be required to offer VRSPs by Jan. 1, 2015.
All employees in those companies with at least one year of uninterrupted service will be automatically enrolled in a VRSP but they will be able to opt-out.
Other key aspects of VRSPs include:
•Age-adjusted investment option: By including a life cycle (such as a target date) fund as the default, the member's asset mix will adjust to their stages of life automatically.
•Locked-in employer contributions for retirement: Although the current proposed VRSP structure allows plan members to reserve savings for retirement and access the contributions they make at any time, the VRSP structure locks in employer contributions until the age of 55 to help ensure employees' savings are earmarked for retirement.
•Portability: Employees who change jobs can continue contributing to the same VRSP.
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