Technology plays an increasingly important role as defined contribution pension plan sponsors seek to deploy decumulation support and retirement advice at scale, said Jean-Michel Lavoie, vice-president of strategy and market development for group retirement services at Sun Life Financial Inc. (pictured right), during a session at Benefits Canada’s 2024 DC Plan Summit in February.

The need for scalable solutions comes as Canada’s retirement-aged population continues to grow and the nature of retirement evolves. “A lot of people are going to go back to work at one point, and maybe work part-time when they finish their full-time employment,” he said. “So their financial plan needs to be flexible and adaptive. A lot of people will also volunteer and this has to do with finding a purpose following a full-time career. Men, in particular, are struggling with that.”

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It’s important for plan sponsors to focus on engagement and advice early in plan members’ careers, as well as offering a simple digital client experience during the accumulation and decumulation phases, he said.

Also speaking during the session, Brad Joudrie, chief revenue officer at Conquest Planning Inc. (pictured left), noted as just a quarter of Canadians have gone through the process of building a financial plan, it’s imperative for plan sponsors to make these tools more available and accessible while gearing them towards decumulation.

“Historically, what [financial planning] has been focused on is really based around accumulation planning. The baby boomers were starting to get jobs and it was all about garnering, gathering and growing assets. Ninety per cent of all financial plans historically have always been based on investment management . . . and it created a situation where only the high net worth and the ultra-high net worth [plan members] got access to these types of solutions.”

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Technology enables plan members to engage at scale with a platform that can help assist and identify possibilities for them, he said, noting while face-to-face interaction is important, solutions like artificial intelligence can help plan members get a better understanding of their plan before meeting with a human financial planner. AI can also help financial planners by automating administrative tasks.

“Ultimately, what we’re trying to do is get [plan members] to a situation where they’ve solved for their retirement goal [and] they’ve created an opportunity where potentially there’s a larger legacy they can leave to their family.”

Read more coverage of the 2024 DC Plan Summit.