Three out of four Canadians would take slightly lower income for better pension: Survey
Canadian workers are still focused on having a good workplace retirement plan, despite the global pandemic, according to a recent survey.
Fifty-five per cent say that they are concerned about retirement security compared to 44 per cent who are worried about job security, finds the survey of 3,500 Canadians, conducted between May 27 and June 5 for the Healthcare of Ontario Pension Plan (HOOPP).
“It reinforced to us how important and top-of-mind retirement savings are for Canadians,” says Steven McCormick, senior vice-president of plan operations at HOOPP in Toronto.
“While dealing with the impact and the immediacy of the pandemic — and the very real challenges that it brings — retirement security remained in the forefront and something that Canadians were concerned about.”
A good retirement plan is seen as more significant than having a higher salary, according to the survey: 79 per cent of workers said they would rather have their employers contribute instead of having that money go into their salaries, while 74 per cent would accept a lower wage package in exchange for a better plan.
“Three out of four Canadians would take a slightly less income today for a pension or a better pension from workplace pension or retirement savings going forward. That remained persistent despite the challenges that that are brought with the pandemic,” says McCormick.
The survey also finds that 72 per cent of Canadians believe there is an emerging crisis on the horizon as COVID continues to impact many worker’s financial well-being.
“Even where people’s individual circumstances — 57 per cent of the individuals surveyed said their financial situations had been harmed by COVID — yet retirement security was on top of mind as well,” says McCormick. “Retirement security is one of these issues that remains persistent and top-of-mind for Canadians throughout these different types of circumstances.”
Other things that provide great value for Canadian workers include an employee assistance program (EAP), found another survey, while the average worker needs 11 times final pay to retire, according to an Aon study.
Regular pension plan deductions are seen as one of the best way to plan for retirement, as 78 per cent find them effective, finds HOOP.
“Simplicity is important, straightforwardness; the discipline that comes from making regular persistent contributions, that is a strong indicator of a good retirement plan is to be able to make regular contributions to it. The ease of payroll deductions is one that approximately 80 per cent of the individuals said would be their preferred way of making contributions to their retirement through the regular deductions, says McCormick.
Educating employees on the value of a good pension or retirement plan is one of the best ways HR can better manage the post-employment period, he says.
“There’s a role for HR leaders to deliver the message, deliver the education and awareness for members and staff that this is a valuable benefit, and how it can help them both in the long run, but in the near term as well, with a little bit of peace of mind knowing that they will be helping contribute towards a strong retirement into the future.”