KPMG LLP has run its first series of retirement education sessions through in-person workshops, one-on-one meetings and a version on Skype for employees at its smaller locations.
The firm introduced the sessions in May after a 2015 pilot program with a small group of employees found people wanted to receive more education about their retirement savings. “It was well received as a pilot, and that’s when we made the decision to offer it more broadly across the firm,” says Emilie Inakazu, senior manager for benefits and pension at KPMG.
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The retirement programs available to KPMG employees include a defined contribution pension, a registered retirement savings plan and a non-registered savings component. Inakazu notes the non-registered plan is available because high-earning employees are likely to hit the Canada Revenue Agency’s ceiling for pension contributions. “It allows them to not lose out on the matching contributions from the firm and continue to contribute,” she says. “The tax implications are obviously different because we have to align with legislation, but we don’t want people to be penalized if they’re high earners.”
The amount of employee contributions to the defined contribution pension and non-registered savings plans depends on years of service, she adds, noting the range is between three and nine per cent of salary. The amount doesn’t, however, increase automatically. “You could have someone with a lot of years of service who still decides to stay lower on the contribution level scale.”
KPMG matches the full amount the employee contributes, with the exception of entry-level staff. In their case, they contribute three per cent, while the company puts in two per cent. “Between four and nine, we’d match exactly what the employee selects,” says Inakazu. “If you’re new to the company, you can’t immediately go to six, seven or eight per cent. You have to hit the years of service before you can do that.”
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Besides educating employees on the basics of their retirement savings options, the sessions also provided information about the investment options available. Research indicates many people don’t understand how to make the best of their investments, says Inakazu, noting a lot of KPMG employees are in the default fund.
The investment-focused sessions refrained from providing advice, she adds. “It was really: ‘Here’s the information you need to make more informed decisions based on what you’re planning in your life. If you’re 34, it’s going to be very different than if you’re 45.’”
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The chief human resources officer informed employees about the retirement sessions through a single email. It included information about the sessions — one of which focused on people looking to retire in the next 10 years and the other aimed at people looking to do so in 10 to 20 years.
“So no age demographic around it. It was really just one invitation that went out to the firm and said, ‘These are the two sessions. Pick the one that makes the most sense to you, based on where you are in your life,’” says Inakazu. “That was the only communication we did, and we got really good uptake right off the bat. Some of our sessions filled up on the first day of registration, and we decided to add more as a result.”
The in-person workshops and the one-on-one sessions took place at KPMG’s larger offices, hosted by advisors from the organization’s pension provider. The Skype sessions, designed for smaller offices, were available in English and French. “Those sessions were more general in nature. They really focused on providing baseline knowledge about planning for retirement,” says Inakazu. “These were recorded, and we made that available on our website, so everyone who wasn’t able to attend can take a listen.”
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Inakazu notes the organization has just finished a review of the retirement sessions and received positive feedback from employees. She’s not yet sure, however, what the next step will be.
“You’re targeting different age groups, and it’s such a range. So to offer them every year, we may not get as much uptake as we did this year, being the first time,” she says. “Our vendor does have different sessions available, so now we know that offering information sessions on these plans are valued, we might look at what else they have to offer and change things up. So maybe every year would look a little bit different, but we’d offer something that our people would value as a result of our retirement plans.”
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