Looking back on what the experts say – Save with SPP
July 21, 2022
Summertime, and while the living is easy, it’s not always easy to get people on the phone for an interview. We get it – there’s only a few short months of great weather in this country, after all.
So, Save with SPP had a look back on what we’ve learned about retirement and saving over the past while through past interviews, and via book reviews, from industry experts and leaders.
Derek Dobson, CEO and Plan Manager of the Colleges of Applied Arts & Technology Pension Plan, pointed to new research from the Canadian Public Pension Leadership Council that showed the economic value of pension dollars. The study found that $16.72 of economic activity arises from every $10 paid out from a pension plan, notes Dobson. And that type of benefit comes from efficient plans, he explains. “Any plan that uses experienced investment professionals, and pooling – I include the Saskatchewan Pension Plan as an example of that – is delivering pensions efficiently,” he tells Save with SPP.
In an interview about the ins and outs of registered retirement income funds (RRIFs), BMO’s James McCreath noted that converting some or all of your registered retirement savings plan (RRSP) to an annuity instead of moving it to a RRIF is also an option.
“As interest rates rise, the functionality and usefulness of annuities go up,” he told Save with SPP. You can read the full interview here.
Prof. Luc Godbout, remarking on the trend of people working longer, had an idea on how to tweak the retirement system to accommodate the needs of older workers. Allowing Canadians to postpone Old Age Security until age 75, and moving the conversion dates for RRSPs/RRIFs to 75, would “optimize the mechanics of pension plans, and also encourage Canadians to remain in the workforce, which improves health and also helps with Canada’s looming labour shortage.” Here’s where you can find the full article.
The author of Getting Out of Debt, Michael Steven, had some interesting thoughts on the importance of saving (once debt is under control).
“Saving requires discipline, a habit you build over time. It can be hard to save instead of spend, but if you have to attain financial freedom, then saving is one of those things you will have to embrace.” You can read the rest of our book review here.
There’s a lot to the broad topic of retirement and saving. For sure, belonging to a workplace pension plan is a key step towards retirement security. If you are saving on your own, you do need to understand the “decumulation stage” when savings are converted to income, either via an annuity or through drawing down a RRIF or similar vehicle. If you don’t have a lot of savings and have boomed your way into your 60s, then the proposed federal changes to benefits discussed by Prof. Godbout may make sense for you. But at the end of the day, as the old saying goes, it’s not what you make, but what you save, that helps your future self paddle through the waters of retirement.
If you don’t have a pension plan at work, and/or haven’t started saving for retirement yet, help is at hand. The Saskatchewan Pension Plan is open to any Canadian with RRSP room, and offers pooled investing, low-fee investment management, and many retirement income options including annuities. Check out SPP today!
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Written by Martin Biefer
Martin Biefer is Senior Pension Writer at Avery & Kerr Communications in Nepean, Ontario. A veteran reporter, editor and pension communicator, he’s now a freelancer. Interests include golf, line dancing and classic rock, and playing guitar. Got a story idea? Let Martin know via LinkedIn.
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