Employee attitudes on retirementFriday August 29, 2014 Written by Brandi Cowen
Canadian workers have big plans for retirement, and many are hoping they won’t have to wait until they turn 65 to start the next chapter of their lives.
New data collected by Standard Life reveals that although most Canadian workers expect to retire at the age of 65 (41 per cent) or older (25 per cent), there are plenty of workers who plan to retire at age 60 (14 per cent) or even earlier (18 per cent). These dreams of early retirement could compound the skills shortage many sectors are already confronting.
In particular, employers offering a defined benefit pension plan should take note: workers with this type of plan are more likely than other workers to plan to retire before they turn 60.
Positive about employer plans
Benefits are very important to Canadian workers and play an important role in helping them prepare for retirement. Most workers have access to a group insurance plan (74 per cent) or a group savings and retirement plan (45 per cent) through an employer. Two in five workers (40 per cent) report their employers offer both a group insurance plan and a group savings and retirement plan.
Workers recognize the benefits they reap from group savings and retirement plans, but many believe these plans are also advantageous to their employers. Majorities of workers agreed that these benefits increase employee retention (86 per cent), increase loyalty (79 per cent), create a more positive attitude among employees (79 per cent) and decrease the likelihood that employees will leave (84 per cent).
Benefits are also an important recruitment tool for employers. Workers report being more likely to recommend their employer to a friend or family member if the company offers group insurance (77 per cent), group savings (82 per cent) or both (84 per cent).
Worried about a comfortable retirement
Regardless of when workers plan to retire, the data reveals that Canadians are concerned about retirement. About two-thirds (65 per cent) worry they will not be able to retire comfortably, and four in five (80 per cent) report they have become more concerned about retirement in recent years.
But despite this rise in concern, those with group savings and retirement plans are generally more positive in their attitudes about retirement. These workers are more likely to report being comfortable with savings and retirement investments associated with some risk (75 per cent), having a financial plan in place that is appropriate for their needs (71 per cent) and feeling confident their plan will allow them to retire comfortably (66 per cent).
To help them plan and prepare for retirement, just eight per cent of workers turn to their employer’s advisor. They are much more likely to turn to their own bank branch advisor (27 per cent), a friend or family member (15 per cent), an independent financial advisor (12 per cent) or a non-bank institutional advisor (11 per cent).
The survey of 600 Canadian employees of small to medium sized enterprises was conducted by Environics' Research House on behalf of Standard Life.