During Benefits Canada’s annual DC Plan Summit, plan sponsors participated in interactive sessions. They split into small groups and were given questions to discuss. Based on these discussions, moderators later offered their insights and relayed key take-aways.
Idan Shlesinger, managing partner, DC pensions and savings plans with Morneau Shepell shares the best ideas from the question he moderated: What should your role be as an employer in supporting your DC employees at and past retirement?
Are the options, tools and information provided to plan members sufficient and appropriate, and what is your role as an employer? There was no consensus about this. Along the spectrum of answers, we have paternalistic plan sponsors that feel their role is a cradle-to-grave support system. Often they had their own life income fund or annuity program, and many, but not all, operate in the public sector. On the other extreme, and more so in the private sector, sponsors see their role as helping employees accumulate assets but leave them on their own when they retire.
Call to action:
- We have focused to date, almost exclusively, on the accumulation phase with auto-enrollment, auto-escalation and TDFs. It is time to start paying attention to what happens when employees leave the workforce, which can be as or more critical to the success of the plan.
- Employers need to decide what their plan philosophy is. Make sure it’s consistent and decisive, and ensure it flows through how you’re communicating the plan to members.
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