{"id":18743,"date":"2020-06-19T09:00:48","date_gmt":"2020-06-19T13:00:48","guid":{"rendered":"https:\/\/www.benefitscanada.com\/news\/editorial-more-insights-from-the-2020-cap-member-survey-146650"},"modified":"2020-06-19T09:00:48","modified_gmt":"2020-06-19T13:00:48","slug":"editorial-more-insights-from-the-2020-cap-member-survey","status":"publish","type":"post","link":"https:\/\/blog.lifeinsurance-orleans.ca\/index.php\/2020\/06\/19\/editorial-more-insights-from-the-2020-cap-member-survey\/","title":{"rendered":"Editorial: More insights from the 2020 CAP Member Survey"},"content":{"rendered":"
<\/div>\n

While we still asked our annual questions about capital accumulation plan members\u2019 retirement readiness, we also wanted to find out how they were managing their investments and their financial well-being in this time of uncertainty. During the subsequent webinar, sponsored by Actuarial Solutions Inc. and Morneau Shepell Ltd., I hosted an insightful discussion about the findings with a panel of industry experts.<\/p>\n

Read: 2020 CAP Member Survey: Challenges ahead<\/a><\/strong><\/p>\n

The cover story attempts to condense this one-hour discussion, but I urge anyone who didn\u2019t tune in at the end of April to visit BenefitsCanada.com\/webinars<\/a> to watch the whole webinar on-demand. In the second half, I veered away from the survey results to ask the experts about some of the hot topics we\u2019ve been hearing from pension plan sponsors during the crisis, including considerations around temporarily reducing contribution levels, whether decumulation is still on the agenda and how they can continue to highlight their employees\u2019 retirement savings and financial well-being.<\/p>\n

During the webinar, Orla Cousineau, director of pensions at the University of British Columbia, said her organization isn\u2019t making any changes to its defined contribution plan, though she acknowledged some employers are considering their options.<\/p>\n

\u201cI worry about that kind of change because, if people aren\u2019t saving for their retirement at this point, if you let them off the hook, it\u2019s going to be hard to make up for that over the long term. They\u2019re going to be missing a period of accumulation, so I wouldn\u2019t go there.\u201d<\/p>\n

Read: Employers permitted to suspend DC pension contributions, says FSRA<\/a><\/strong><\/p>\n

Michelle Loder, partner in DC solutions at Morneau Shepell, advised webinar attendees that changing contribution levels is a decision that requires a lot of careful consideration, especially for employers that have implemented mandatory participation as a plan philosophy in the past.<\/p>\n

\u201cIt\u2019s a big step to suspend or reduce contributions and it comes with long-term consequences on retirement readiness. Yet, I do appreciate it\u2019s one that might be necessary for both employers and their employees, depending on the circumstances. I would encourage sponsors to take a very measured and patient approach to considering it.\u201d<\/p>\n

During the discussion on decumulation features, Loder said she doesn\u2019t expect the recent move towards these features to slow down, even in light of the pandemic. \u201cIn fact, under the current circumstances, many sponsors are seeing decumulation features that will support efficient retirement income are becoming even more of an imperative. . . . Decumulation features can be a very welcome development and certainly an extremely valuable one for plan members at little to no cost to implement. I\u2019m hopeful that we will continue to see decumulation features being considered very carefully.\u201d<\/p>\n

Turning to employees\u2019 financial well-being, Joe Nunes, executive chairman at Actuarial Solutions, said employers have to go beyond retirement savings and consider plan members\u2019 holistic financial picture.<\/p>\n

Read: Webinar: 2020 CAP Member Survey: Retirement savings, financial well-being in the era of coronavirus<\/a><\/strong><\/p>\n

\u201cI think it\u2019s important for plan sponsors to start to get a bigger picture in the relationship with their employees on how all that\u2019s being managed. But if you want to narrowly look at CAPs, I think there\u2019s some effort that can be made on education \u2014 just helping members understand the relationship between savings rates, investment risk and realistic retirement age. . . .<\/p>\n

\u201cWorking longer is one lever, but it\u2019s not the only lever, and if we can convince people that greater savings rates make sense, if getting the right amount of investment risk at the right stage of life makes sense, then maybe everyone reaches a happier ending.\u201d<\/p>\n

Jennifer Paterson<\/a> is the editor of <\/em>Benefits Canada.<\/em><\/p>\n

Read the full article at BenefitsCanada.com<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

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