There are many facets to a successful workplace pension plan. Proper governance, smart investing, and prudent design, for example, are all vital to optimizing retirement outcomes for plan members. So too is effective professional support. Unfortunately, not all plan support is built equally. Without a high level of support baked into a pension plan’s foundation, members can become weary about where their contributions are going and what they can expect when retirement rolls around.
Although the majority of employees recognize the inherent value of a pension plan, making the requisite contributions can still be a hard pill to swallow. After all, we are living in a time of record-high inflation and soaring housing costs. For most private sector workers in Canada, every penny counts. Assuring plan members that the contributions they make today will provide enhanced retirement security in the future is key.
There are a number of areas where pension plan support can falter. First, when a plan is run in-house by an individual sponsoring employer, it often falls on the human resources team to handle daily administration. This requires a high level of expertise that company personnel may not have the time or training to deliver. Second, certain plan designs offer a large suite of investment options that can be challenging for the average plan member to make an informed decision on. While education on these investments will be provided, without adequate professional guidance members can easily get overwhelmed and make suboptimal selections. Finally, typical Defined Contribution (DC) arrangements offer no support to retirees. This means that members are left to manage their pension savings on their own, including determining appropriate withdrawal levels to ensure lifetime income.
So what does a solid pension plan support strategy look like? There’s no one-size-fits-all answer, but some best practices can ensure members are well-equipped with the right tools and information. The Ideal Canadian Pension Plan provides enhanced support to our members every step of the way, from onboarding to retirement, and beyond. This includes:
- Simplified onboarding process with clear instruction and easy-to-understand plan documents
- Efficient on-going assistance from pension professionals by phone and email to answer member questions and concerns
- Effective education and communications that help members set reasonable targets and track their progress
- Automatic investing that eliminates the burden of selecting investments and removes the need for investing support
- Continued support for retired members to manage withdrawal levels for reliable lifetime payments
- Dedicated member portal for direct access to plan materials, helpful information and account details
This multi-tiered approach to plan support helps our members feel confident and empowered about their retirement goals. It also means that our participating employers are relieved of dealing with the onerous day-to-day support workplace pension plans require. We take care of everything from member queries to group presentations to plan updates. The result? Members of the ICPP understand the true value of their pension.