The continuing demographic shift has put the retirement income issue into the spotlight and prompted discussion between government, the private sector and Canadians. But people’s confusion over exactly how—and how much—they need to save is becoming more apparent and needs to be addressed, said Claude Leblanc, senior vice-president, group savings and retirement, with Standard Life.

“Debate about PRPP and changes to the QPP/CPP has started and will stay on the agenda for the coming years. It’s going to be important to be organized and structured in the debate for pension reform,” Leblanc said in a presentation to delegates at The Conference Board of Canada’s Summit on the Future of Pensions this week.

Leblanc said that while the majority of Canadians seem unclear on how to ensure that they save an adequate level of retirement income through their working years, most want to learn.

“There is hope. We have an educated population that will understand if we spend time educating them.”

The recognition that financial literacy needs to improve in order for Canadians to effectively plan for their future and the subsequent establishment of the Task Force on Financial Literacy were positive steps in this direction, said Leblanc.

Of the 30 recommendations released earlier this year by the Task Force, Leblanc cites five as being essential for helping clear up retirement planning confusion for current and future generations:

  • That the Government of Canada include financial literacy in its Essential Skills Framework, a document that lists nine skills deemed essential for success in the workplace; financial literacy is not currently on this list.
  • That employers incorporate financial literacy training into their current workplace training programs and communications. Federal and provincial/territorial governments should make workplace financial literacy programs eligible for tax assistance.
  • That employers offer automatic saving programs and tools to facilitate increased lifelong saving by Canadians, drawing on international best practices. “One thing I’ve learned in 35 years in the financial services industry is the fundamental strength of payroll deductions. This is the best way to have a painless process in place to save money,” said Leblanc.
  • That the Government of Canada create, maintain, continuously upgrade and promote a single-source website for financial literacy, in an effort to increase public awareness about, and ease of access to, information. “More and more, people are counting on advice to move forward, and sometimes they don’t know how to [find that advice]. This is a nice, democratic way to inform the population.”
  • That the federal and provincial/territorial governments require all financial services providers within their respective jurisdictions to simplify their informational materials and disclosure documents. Governments should lead this effort by reviewing and improving their own public informational materials to ensure that they meet clear communications principles.

Aside from literacy, Leblanc says Canadian governments need to rethink policies around retirement savings, particularly with regard to creating more flexibility in tax laws regulating the amount of money Canadians can save for retirement. He said the U.K.’s regulations around pension schemes—which allow citizens to invest money into registered pension vehicles at any time subject to a lifetime, rather than annual, contribution limit, and offer a high level of tax relief on contributions—could work well in Canada to help individuals save when it best suits their situation.

“If we do the right things…I think we can count on developing many ‘golden eggs,’ and the Canadian population will be happy and well-served,” said Leblanc. “Before thinking of building up retirement income, people have to learn how to save, and we need to help them.”

Copyright © 2019 Transcontinental Media G.P. Originally published on

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