Manulife Financial Corp.’s latest financial stress survey found two-thirds (64 per cent) of employees aged 55 and younger and 50 per cent of workers aged 55 and older are seeking more financial advice from their employer, said Marc-Antoine Morin, the organization’s assistant vice-president of product development for group retirement solutions, during a session at Benefits Canada’s 2024 Defined Contribution Plan Summit in February.
“As a plan sponsor, that 50 per cent [or workers aged 55 and older] is a concern. From a productivity standpoint, the last thing you want is financial anxiety — you want to make sure you continue to have these people [who are nearing retirement] be productive for your organization. Investing in that area is going to decrease the anxiety and boost the productivity.”
Read: Gap persists between DC plan sponsor, member views on retirement readiness: survey
A healthy retirement is a trifecta of wealth and physical and social health, he said, noting while money is the most prominent factor, health determines how a worker will spend their retirement as well as how much money they’ll need.
“We need to talk about life expectancy and [how] your health is going to be a huge contributing factor. If you invest in [employees’ health] they can actually start to take care of their health and invest in themselves.”
It’s also important for plan members to know what their retirement will look like well ahead of time and to look forward to a time after employment, said Morin. “People should look forward to [retirement] — they should be excited. We want to make sure that they’re excited to move in that other part of their life. They deserve it, they’ve been working for maybe 40 years. [It’s important] they’re excited and feeling confident . . . to move to this other phase of their life.”
Read: New surveys highlight discrepancies in retirement readiness
When it comes to motivating plan members to prepare for retirement, simple and accessible retirement planning resources are key. “We can’t overestimate people’s ability to plan and engage with financial content. . . . Education, guidance and tools have a role to play there but it’s not enough. If you want to really address [employees’] financial anxiety . . . having access to human advice is really a game-changer.”
It’s also important for employers to always have retirement resources on hand as it’s difficult to gauge when workers will start planning for retirement, said Morin, adding it’s often triggered by a life event, such as a health issue, buying or selling a home or children completing post-secondary education.
“You don’t know what or when that event is going to happen to your employees. You need to make sure that your resources are always available. . . . Ideally, it needs to be integrated in the day-to-day experience of your members as much as possible because you want to make sure your resources are available at the right time.”
Read more coverage of the 2024 DC Plan Summit.