After reaching new highs at the end of 2024, capital accumulation plan member outcomes have seen significant impacts following the inauguration of U.S. President Donald Trump and subsequent tariffs on Canadian imports, according to a new report by Eckler Ltd.
The consultancy’s latest CAP income tracker found a typical male member retiring at the end of March achieved a gross income replacement ratio of 63.8 per cent, down from 66.5 per cent in December 2024. By comparison, a typical female member achieved 62.2 per cent, down from 64.8 per cent.
Read: CAP members’ 2024 outcomes highest since start of pandemic: report
The report noted U.S. tariffs are expected to significantly impact household expenses in Canada and will also likely have a significant impact on retirement savings. “For those nearing retirement, economic uncertainty, market volatility and the potential for higher inflation have created significant anxiety, prompting some to reconsider when they will exit the workforce,” said the report.
It also emphasized the importance of financial wellness support for employees amid a challenging economic backdrop, noting it’s important for employers to encourage workers to have a financial plan.
“Providing your employees with financial planning tools can help alleviate the stress of the current situation by showing them where their money is currently being spent and where they can make adjustments. Planning tools can also give them the confidence to remain focused on their long-term goals.”
Read: CAP member outcomes continue to rise in Q3 2024: report