These videos are designed to help you unlock the power of your group savings plan and reach your savings goals.
Is debt getting in the way of your financial well-being? This webinar will help you better understand it and create a plan to pay it down.
Learn about:
- Credit scores and how they work
- Strategies for paying off your debt
- Where you can get help
Description:
This webinar is presented in ASL by a middle-aged man. He is standing in front of a grey screen with slides to his left. This webinar is provided by Canada Life and many of the slides have the Canada Life logo on them.
Slide 1: Managing debt – From stress to security
This is the cover slide. It displays the title of the presentation, setting the tone for a guide focused on helping individuals move from financial stress to security.
Presenter:
Hello and welcome to today’s webinar, Managing Debt from stress to security.
Slide 2: Have debt? You’re not alone.
Presents key statistics:
$2.5 trillion in consumer debt in Canada.
$4,300 is the average credit card balance.
1 in 23 Canadians have missed at least one payment.
Presenter:
Now one of the reasons you may have joined this webinar is that you currently hold debt. Rest assured, you’re not alone.
Consumer debt in Canada reached $2.5 trillion in Q2 of 2024 & the
Average credit card holder carries a balance of $4,300 – this is highest level we’ve seen since 2007 unfortunately, 1 in 23 consumers missed a payment on at least one credit product in Q2 2024
These statistics are reason for concern and in my opinion indicates the importance of addressing debt within your own personal financial situation.
Let’s start the conversation on how you can understand the debt you hold so you can feel more confident in managing it in the future.
Slide 3: Agenda
Outlines the four main topics covered:
Debt vocabulary.
Understanding your credit score.
Getting your debt under control.
Signs you’re financially secure.
Presenter:
We’ll review the different types of debt, dive into how debt works and talk about how you can begin to take control of it and make progress towards financial stability.
Slide 4: Debt Vocabulary
Introduces the section on understanding common debt-related terms.
Presenter:
To understand debt, and how to get out of it, a great place to start is by learning the vocabulary used to describe it.
Slide 5: Debt vocabulary
Defines:
Minimum payment: The smallest amount you must pay on a debt.
Interest: The cost of borrowing money.
Principal: The original amount borrowed, not including interest.
Presenter:
Let’s start with the basics;
Principal: Is the amount you borrowed, excluding additional charges, like interest.
Interest: The amount your lender charges you to borrow money.
How much interest you’re charged will depend on how much you owe and your interest rate. Keep in mind;
Different credit products have different rates. For example, your credit card may have an annual interest rate of 19%, while your mortgage might have an interest rate of 5%.
Minimum payment: The minimum amount you’re required to pay on the debt you owe. If you don’t make the payment, you’ll risk lowering your credit score.
Slide 6: Debt vocabulary
Explains:
Secured debt: Backed by an asset, which can be reclaimed if payments are missed.
Unsecured debt: Not backed by an asset, only by your promise to repay.
Notes that some credit-rebuilding products may be secured by a deposit.
Presenter:
Secured debt: Debt that’s tied to the asset (like a car, appliance, electronic device or house) you used it to buy. With secured debt the lender has the right to take back the asset if you don’t make your payments.
Exception: Products designed to help you re-build your credit may also be secured by a deposit you provide to the lender in exchange for use of the product. For example, a secured credit card.
Unsecured debt: Debt that isn’t secured by anything other than your commitment to repay it. Credit card debt is a good example of debt that’s usually unsecured.
Secured debts usually have lower interest rates than unsecured debts because they’re less risky for the lender. It’s because if you don’t repay your debt the lender can take and sell your asset to recover some or all of their losses.
Slide 7: Debt vocabulary
Defines:
Amortization: Total time to repay a debt.
Term: The fixed period for repayment and interest rate.
Revolving credit: Credit that can be reused after repayment.
Presenter:
Amortization: The amount of time you have to repay your debt. For example, many mortgages have amortization periods of 25 years, while car loans often have amortization periods of 5 years.
Term: How long your repayment and interest terms are locked in for. With some debt products, like mortgages, if you repay your debt before the term is up, you may incur extra fees and penalties. Debt products that are available for no set amount of time, like credit cards, won’t have a specific term and you can repay it anytime.
Revolving credit: Credit products that allow you to re-borrow money once you pay it. Credit cards are the most common example of revolving credit.
Slide 8: Credit cards & lines of credit - How they’re the same
Lists similarities between credit cards and lines of credit:
Both are revolving credit.
Both may use a card.
Payments vary with balance.
Interest is charged immediately on cash advances.
Presenter:
Let’s review one of the questions that often get’s asked when comparing debt products.
What’s the difference between credit cards and lines of credit?
First, How are they the same
Both are types of revolving credit
Both may be accessed using a card
Both require monthly payments that go up when your balance goes up and go down when your balance goes down
Both charge interest immediately on cash advances
Slide 9: Credit cards & lines of credit - How they’re different
Outlines differences:
Credit cards have higher interest rates (~20%).
Lines of credit have lower rates but are harder to qualify for.
Lines may allow interest-only payments.
Credit cards offer a 21-day grace period; lines of credit do not.
Presenter:
Let’s consider the difference between a credit card and a line of credit.
Credit cards typically have rates around 20%
Lines of credit usually have much lower rates, in part because they can be harder to qualify for.
Lines of credit sometimes have interest-only repayment options
Credit cards usually have a grace period of 21 days where you aren’t charged interest on your purchases
You’re charged interest as soon as you make a purchase on a line of credit
This information is general. Review the terms and conditions of your specific credit products for the most accurate information.
Slide 10: Understanding Your Credit Score
Slide to introduce the section on credit scores
Presenter:
Now that we have an understanding of debt, let’s review one of it’s impacts.
When you want to apply to take on new debt, your credit score is a major deciding factor if you’ll get approved. Now let’s talk about how credit works, and what you can do to boost your credit score.
Slide 11: What does it mean to have good or bad credit?
Explains:
Credit scores are 3-digit numbers used by lenders.
A high score means better access to credit and lower rates.
A low score limits financial options
Presenter:
What does it mean to have a good or bad credit score and why is it important:
First, Canada’s lenders rely on your credit score to help them decide if they should lend you money and what interest rate to charge.
Your credit score is a three-digit number that comes from the information in your credit report.
When people talk about having good or bad credit, they’re usually referring to having either a high (good) or low (bad) credit score.
The higher your credit score, the more credit with favorable rates will be available to you.
Slide 12: Collecting your credit information
Describes:
TransUnion and Equifax are Canada’s main credit bureaus.
Lenders report your credit activity to them.
These reports influence your credit score.
Presenter:
You’re probably wondering how your credit score is calculated. Collecting information about how you use your credit is the first step. In Canada, TransUnion and Equifax are the two main credit bureaus who collect this information.
Lenders send information about how you use your credit to the bureaus so they can calculate your credit score.
These businesses or individuals use your credit report to help them make decisions about you.
These decisions could be to:
lend you money
collect a debt
consider you for rental housing
consider you for a job
provide you with insurance
offer you a credit increase
Just to name a few. As you can tell, this can have a big impact on your financial wellbeing.
Slide 13: What influences my credit score?
Lists factors:
Length of credit history.
Age of each credit account.
Credit card balances.
Missed payments.
Usage near or over credit limits.
Presenter:
Now, let’s review what influences your score and ways you improve it.
Your score is influenced by:
How long you’ve had credit – Your credit history takes time to build. A lack of credit history can negatively impact your score
How long each credit has been in your report. Having credit products in good standing for a long time (years) helps increase your score.
If you carry a balance on your credit cards. You can still have good credit if you carry a balance on your credit cards, but your score will be higher if you repay everything that’s owing each month.
If you regularly miss your minimum payments. This will make your score lower.
If you’re usually close to or above your credit limit. This also lowers your score. When all your credit is “maxed out” it indicates to lenders you may be under financial strain and have difficulty repaying your debt.
Slide 14: What influences my credit score?
Adds more factors:
Number of recent credit applications.
Types of credit used.
Accounts in collections.
Bankruptcy or consumer proposals.
Presenter:
Number of recent credit applications. The more applications, the lower your score.
Type of credit you’re using. Credit cards tend to build your credit score faster than any other type of loan, like a mortgage. And having a mix of credit types can help to keep your credit score high.
If your debts have gone to a collections agency. Even debt, like an unpaid phone bill, that goes to collections can lower your credit score.
If you’ve claimed bankruptcy or have had to go through a consumer proposal, your score will go down significantly.
Keep in mind, the changes to your score aren’t permanent. It’s continuously being recalculated.
Slide 15: How can I improve my credit score?
Tips include:
Make payments on time.
Don’t skip payments.
Pay at least the minimum.
Stay under 30% of your credit limit.
Keep older accounts open.
Limit credit checks.
Use a mix of credit types.
Presenter:
I think I can safely say that everyone wants to have a good credit score. Here are some considerations for increasing your credit score, whether you're building it for the first time, trying to raise it or trying to maintain a good score, the actions you take are the same.
#1 Make payments
Always make your payments on time.
Don’t skip a payment.
Pay at least the minimum that’s required.
#2 Use credit wisely
Don’t go over your limit.
Try to use less than 30% of what’s available to you.
#3 Keep older credit products open
Consider keeping an older credit product open, even if you don’t need it. Credit products that have been in good standing for a long time help your score.
#4 Limit checks
While it’s normal to apply for credit from time to time, do what you can to limit the number of checks you allow.
Get your quotes from different lenders within a 2-week period when you’re shopping around for a car loan or mortgage. When you do this, credit bureaus will combine and treat your inquiries as a single inquiry for your score.
#5 Diversify
It’s better to have a mix of credit products. Such as a credit card, a car loan and a line of credit.
Slide 16: How long information stays on your credit report
Explains:
Positive info stays as long as the account is open.
Closed accounts stay 10–20 years.
Negative info (e.g., late payments) stays 6 years.
Credit checks stay 3–6 years.
Bankruptcy stays 6–7 years.
Presenter:
As we discussed, your credit score is consistently evolving so it’s good to review how long information stays on your report.
First, the Positive information
Includes credit that you’ve paid as agreed and have no negative history for.
Depends on the type of information.
Active accounts stay on your report for as long as they're open.
Equifax reports closed accounts for 10 years and TransUnion for up to 20.
Negative information
Things that negatively impact your score, like late payments or accounts going to collections.
Negative information about accounts (like credit cards) stays on your report for 6 years.
Credit checks by lenders, Equifax reports it for 3 years and TransUnion for 6 years.
Bankruptcy stays on your report for 6 or 7 years, depending on the province.
No matter where you have been in the past, establishing and maintaining good debt habits overtime, will help your achieve a better rating.
Slide 17: Getting your debt under control
Introduces the section on managing debt, including six steps to tackle it.
Presenter:
At Canada Life, our mission is to improve the financial, mental and physical well being of Canadians. We know that financial stress is impacting a lot of Canadians.
If you’re struggling to pay off your debt or a lot of your income is going towards debt repayment, there are a few things that you can do to get your debt under control.
Slide 18: Six steps to tackle your debt
Lists six steps to tackle debt:
Make a list of debts
Create a budget
Choose a repayment strategy
Consolidate your debts
Stay on track
Get help if you need
Presenter:
In the following section we’ll cover 6 steps you can take to tackle your debt.
Slide 19: Make a list of your debts
Step 1 of 6. Suggests listing all debts with:
Name of debt.
Balance.
Interest rate.
Minimum payment. An example table is provided.
Presenter:
The first step of tackling your debt is to make a list of all your debts. For each one, you should note:
The total amount you owe
The minimum monthly payment and
The interest rate
You can also use the Financial Goal Calculator when you visit Canada.ca.
By making a list of your debts, you can get an accurate picture of your own situation – the types of debts you have and how it fits into your monthly budget.
Slide 20: Create a budget
Step 2 of 6. Defines budgeting as tracking income, expenses, and savings to reach financial goals.
Presenter:
Step 2 Budgeting
What is budgeting?
- Budgeting is the exercise of documenting all your monthly income, expenses and savings.
- Having a budget helps you spend with intention so you can reach your financial goals – like saving more or paying down debt.
Slide 21: What’s budgeting? How to make a budget
Explains how to:
Document income and expenses.
Use accurate or average numbers.
Identify areas to save.
Create and update a budget.
Presenter:
Making a budget might seem daunting but you can make it easier once you build the right habits and use the right tools. A budget is simply making a list of the income you earn or receive each month and comparing it to what you spend. To help you along, Canada Life has made a free budgeting worksheet available to you at canadalife.com/cashcalculator.
If you’re not sure where to start, here’s how to make a budget in three steps.
Step 1: Document what you earn and spend
Include income from all sources, like employment, spousal support and child tax credits.
Try to use accurate numbers for your expenses instead of guessing.
For expenses that change each month, use the average.
Step 2: Find areas where you can save
Once your income and expenses are documented it’s easier to find areas you can cut back spending.
Are you spending more than you earn? Are you spending with intention or have you made impulsive purchases? Are there any bills you can eliminate all together, like multiple streaming services, old subscriptions, or an unused gym membership?
Consider lifestyle changes to help you only spend what you can afford to.
Step 3: Make a budget
Turn your observations into a budget you can follow. If you’re using the budgeting worksheet, adjust it to reflect what you plan to spend on each item going forward.
Finally, update your budget when things change. For example, if you have a new ongoing expense to account for, or if your income increases.
Slide 22: Choose a debt repayment strategy
Step 3 of 6. Two strategies:
Lowest balance first: Motivating, improves cash flow, but may cost more in interest.
Highest interest first: Saves money long-term, but may take longer to feel relief.
Presenter:
If you have debt, then your budget should include how much of your income you plan to use to repay it. Your next step is in tackling your debt, it to choose a strategy for repaying it.
This is where your list of debts you did in the first step will come in handy. Use it in combination with your budget to help you decide which strategy will work best for you.
Pay debts with the lowest balances first
Helps keep you motivated to stay on track since you’ll feel the accomplishment of paying off a debt sooner.
It may improve your overall cashflow sooner since you’ll have fewer minimum payments to make earlier on.
Beware, with this strategy you may end up paying more interest over time.
Pay debts with the highest interest rates first
In theory, this strategy makes the most financial sense.
You’ll ultimately pay less interest which will help you become debt-free sooner.
But in some cases, it may not be the right way to go. For example, if you’re struggling to make your minimum payments, this method could take longer to provide relief since the focus is lowering interest costs and not the total number of debts you’re paying.
Slide 23: What’s debt consolidation?
Step 4 of 6. Describes debt consolidation:
Combining multiple debts into one.
Applying for a consolidation loan.
Presenter:
Step 4 – Consider consolidating your debts
What’s debt consolidation?
Debt consolidation is when you combine multiple smaller debts into one larger debt.
Work with your preferred lender to apply for a consolidation loan (or other debt product).
Slide 24: Consider consolidating your debts
Explains benefits:
Lower interest.
Better cash flow.
Easier tracking. Also notes challenges:
Harder to qualify.
Secured loans carry risk.
Lenders prefer consolidating their own debts.
Presenter:
So, how can consolidating debt help you? Here are some considerations:
First, the potential benefits of debt consolidation
Depending on the interest rates of your debts and the consolidation loan, it could lower the total amount of interest you pay.
It could improve your cashflow if your current minimum repayment requirements are higher than the singular payment would be.
It’s easier to keep track of one payment compared to several. This can make it easier to ensure your payments are made on time.
More considerations
It can be difficult to qualify for a consolidation loan, especially if your income and/or credit score is low.
Lenders are more likely to approve secured consolidation loans, for example adding your debt to your mortgage. It could be a great option, but keep in mind, if you can’t pay it, now your house is on the line.
Lenders are more likely to consolidate debt that’s already held by them.
Slide 25: Stay on track
Step 5 of 6. Tips:
Stick to your budget.
Plan for emergencies.
Avoid new debt.
Pay more than the minimum.
Presenter:
Managing debt is not a one-time exercise, it is something you will always need to be mindful of, and step 5 is information on how to build good habits and stay on track.
#1 Follow your budget and update it when things change. The longer you have a budget the more accurate your understanding of what your lifestyle costs.
#2 Plan for those emergencies. You do your best to manage your debt but life happens so it’s important to incorporate emergency savings into your and perhaps consider insurance to account for those unforeseen event.
#3 How about avoiding taking on more debt. If possible.
#4 Pay more than the minimum payments.
Slide 26: Example: Paying more than the minimum
Compares two repayment scenarios for a $5,000 credit card debt at 18% interest:
Minimum only: Takes nearly 19 years, costs $4,799 in interest.
Minimum + $100: Takes just over 3 years, saves $3,502 in interest.
Presenter:
You might be wondering why I’m suggesting you pay more than the minimums. It’s because some credit products like credit cards, have minimum payments that aren’t designed to help you pay repay your debt quickly.
On credit cards, your minimum payment will typically be the higher of a dollar amount or a percentage of your outstanding balance. By paying only the minimum payment amount, you’re extending the amount of time it will take to repay your debt and increasing the total amount of interest you’ll have paid.
Let’s look at an example to illustrate how paying more than your minimum can result in a lot of savings.
In this example we have a $5,000 balance on our credit card. The interest rate is 18% and the minimum payment required is the greater of $10 or 3% of your outstanding balance. In the first scenario we’ll pay only the minimum that’s required of us. In the second scenario we’ll pay the minimum plus an extra $100 each month.
As you can see, the extra $100 each month makes a big difference.
We’ve saved a lot of time. Instead of paying off our credit card balance in almost 19 years, we’re paying it off in just over 3.
And because we’re paying it sooner, we’re also saving in interest charges and will end up paying around $3,502.
Slide 27: Get help if you need it
Step 6 of 6. Encourages seeking help:
Credit counsellors offer advice.
Professionals can help with bankruptcy or consumer proposals.
Presenter:
The last step to consider, Step 6: Get help if you need it
Tackling debt can feel overwhelming – you don’t need to do it alone.
Credit counsellors can give you advice and help you make a strategy.
Professionals can help you decide if you need to take a bigger step than what we’ve talked about today.
Slide 28: Help with debt is included with your plan
Lists support resources:
Credit Counselling Society: nomoredebts.org, 1-877-636-8999.
Québec/Atlantic: solveyourdebts.com, 1-888-753-2227.
Presenter:
As a Canada Life group savings plan member, you have access to free and discounted credit counselling services from these non-profit organizations. The phone numbers you see on the screen are exclusive to Canada Life plan members. Or you can go to their websites to explore on your own.
The Credit Counselling Society is a non-profit service available to help you manage your expenses during challenging times. You'll get confidential one-on-one financial coaching. If you're in Quebec or the Atlantic provinces, contact Credit Counselling Services of Atlantic Canada.
Slide 29: Reduced fees for Canada Life plan members
Outlines fee reductions:
Free counselling.
Waived setup fees.
Monthly fees capped at 10% of deposit, up to $75.
Presenter:
Here are the fees for accessing their services. As shown, your plan gives you access to most services for free.
Slide 30: How will I know when my debt is under control and my financial well-being is good?
Indicators of financial well-being:
Meeting financial needs.
Resilience to future challenges.
Progress on goals.
Freedom to make life choices.
Presenter:
I hope you found this information useful. It can be so empowering when you feel positive about your financial future.
When your financial well-being is good, you’ve met your current commitments and needs comfortably and have the financial resilience to maintain this in the future. It can mean having control over your finances, being able to navigate a financial setback, meeting your financial goals or having the freedom to make choices that let you find balance in your life.
Slide 31: Questions?
Encourages reaching out for help. Provides a phone number and website for support. States that the information is general and educational. No guarantees are made about future outcomes.
Presenter:
That brings us to the end of our presentation. Thank you for watching. Be sure to check out our other webinars to keep learning about money and your group savings plan
Description:
This webinar is presented in ASL by a middle-aged man. He is standing in front of a grey screen with slides to his left. This webinar is provided by Canada Life and many of the slides have the Canada Life logo on them.
Slide 1: Managing debt – From stress to security
This is the cover slide. It displays the title of the presentation, setting the tone for a guide focused on helping individuals move from financial stress to security.
Presenter:
Hello and welcome to today’s webinar, Managing Debt from stress to security.
Slide 2: Have debt? You’re not alone.
Presents key statistics:
$2.5 trillion in consumer debt in Canada.
$4,300 is the average credit card balance.
1 in 23 Canadians have missed at least one payment.
Presenter:
Now one of the reasons you may have joined this webinar is that you currently hold debt. Rest assured, you’re not alone.
Consumer debt in Canada reached $2.5 trillion in Q2 of 2024 & the
Average credit card holder carries a balance of $4,300 – this is highest level we’ve seen since 2007 unfortunately, 1 in 23 consumers missed a payment on at least one credit product in Q2 2024
These statistics are reason for concern and in my opinion indicates the importance of addressing debt within your own personal financial situation.
Let’s start the conversation on how you can understand the debt you hold so you can feel more confident in managing it in the future.
Slide 3: Agenda
Outlines the four main topics covered:
Debt vocabulary.
Understanding your credit score.
Getting your debt under control.
Signs you’re financially secure.
Presenter:
We’ll review the different types of debt, dive into how debt works and talk about how you can begin to take control of it and make progress towards financial stability.
Slide 4: Debt Vocabulary
Introduces the section on understanding common debt-related terms.
Presenter:
To understand debt, and how to get out of it, a great place to start is by learning the vocabulary used to describe it.
Slide 5: Debt vocabulary
Defines:
Minimum payment: The smallest amount you must pay on a debt.
Interest: The cost of borrowing money.
Principal: The original amount borrowed, not including interest.
Presenter:
Let’s start with the basics;
Principal: Is the amount you borrowed, excluding additional charges, like interest.
Interest: The amount your lender charges you to borrow money.
How much interest you’re charged will depend on how much you owe and your interest rate. Keep in mind;
Different credit products have different rates. For example, your credit card may have an annual interest rate of 19%, while your mortgage might have an interest rate of 5%.
Minimum payment: The minimum amount you’re required to pay on the debt you owe. If you don’t make the payment, you’ll risk lowering your credit score.
Slide 6: Debt vocabulary
Explains:
Secured debt: Backed by an asset, which can be reclaimed if payments are missed.
Unsecured debt: Not backed by an asset, only by your promise to repay.
Notes that some credit-rebuilding products may be secured by a deposit.
Presenter:
Secured debt: Debt that’s tied to the asset (like a car, appliance, electronic device or house) you used it to buy. With secured debt the lender has the right to take back the asset if you don’t make your payments.
Exception: Products designed to help you re-build your credit may also be secured by a deposit you provide to the lender in exchange for use of the product. For example, a secured credit card.
Unsecured debt: Debt that isn’t secured by anything other than your commitment to repay it. Credit card debt is a good example of debt that’s usually unsecured.
Secured debts usually have lower interest rates than unsecured debts because they’re less risky for the lender. It’s because if you don’t repay your debt the lender can take and sell your asset to recover some or all of their losses.
Slide 7: Debt vocabulary
Defines:
Amortization: Total time to repay a debt.
Term: The fixed period for repayment and interest rate.
Revolving credit: Credit that can be reused after repayment.
Presenter:
Amortization: The amount of time you have to repay your debt. For example, many mortgages have amortization periods of 25 years, while car loans often have amortization periods of 5 years.
Term: How long your repayment and interest terms are locked in for. With some debt products, like mortgages, if you repay your debt before the term is up, you may incur extra fees and penalties. Debt products that are available for no set amount of time, like credit cards, won’t have a specific term and you can repay it anytime.
Revolving credit: Credit products that allow you to re-borrow money once you pay it. Credit cards are the most common example of revolving credit.
Slide 8: Credit cards & lines of credit - How they’re the same
Lists similarities between credit cards and lines of credit:
Both are revolving credit.
Both may use a card.
Payments vary with balance.
Interest is charged immediately on cash advances.
Presenter:
Let’s review one of the questions that often get’s asked when comparing debt products.
What’s the difference between credit cards and lines of credit?
First, How are they the same
Both are types of revolving credit
Both may be accessed using a card
Both require monthly payments that go up when your balance goes up and go down when your balance goes down
Both charge interest immediately on cash advances
Slide 9: Credit cards & lines of credit - How they’re different
Outlines differences:
Credit cards have higher interest rates (~20%).
Lines of credit have lower rates but are harder to qualify for.
Lines may allow interest-only payments.
Credit cards offer a 21-day grace period; lines of credit do not.
Presenter:
Let’s consider the difference between a credit card and a line of credit.
Credit cards typically have rates around 20%
Lines of credit usually have much lower rates, in part because they can be harder to qualify for.
Lines of credit sometimes have interest-only repayment options
Credit cards usually have a grace period of 21 days where you aren’t charged interest on your purchases
You’re charged interest as soon as you make a purchase on a line of credit
This information is general. Review the terms and conditions of your specific credit products for the most accurate information.
Slide 10: Understanding Your Credit Score
Slide to introduce the section on credit scores
Presenter:
Now that we have an understanding of debt, let’s review one of it’s impacts.
When you want to apply to take on new debt, your credit score is a major deciding factor if you’ll get approved. Now let’s talk about how credit works, and what you can do to boost your credit score.
Slide 11: What does it mean to have good or bad credit?
Explains:
Credit scores are 3-digit numbers used by lenders.
A high score means better access to credit and lower rates.
A low score limits financial options
Presenter:
What does it mean to have a good or bad credit score and why is it important:
First, Canada’s lenders rely on your credit score to help them decide if they should lend you money and what interest rate to charge.
Your credit score is a three-digit number that comes from the information in your credit report.
When people talk about having good or bad credit, they’re usually referring to having either a high (good) or low (bad) credit score.
The higher your credit score, the more credit with favorable rates will be available to you.
Slide 12: Collecting your credit information
Describes:
TransUnion and Equifax are Canada’s main credit bureaus.
Lenders report your credit activity to them.
These reports influence your credit score.
Presenter:
You’re probably wondering how your credit score is calculated. Collecting information about how you use your credit is the first step. In Canada, TransUnion and Equifax are the two main credit bureaus who collect this information.
Lenders send information about how you use your credit to the bureaus so they can calculate your credit score.
These businesses or individuals use your credit report to help them make decisions about you.
These decisions could be to:
lend you money
collect a debt
consider you for rental housing
consider you for a job
provide you with insurance
offer you a credit increase
Just to name a few. As you can tell, this can have a big impact on your financial wellbeing.
Slide 13: What influences my credit score?
Lists factors:
Length of credit history.
Age of each credit account.
Credit card balances.
Missed payments.
Usage near or over credit limits.
Presenter:
Now, let’s review what influences your score and ways you improve it.
Your score is influenced by:
How long you’ve had credit – Your credit history takes time to build. A lack of credit history can negatively impact your score
How long each credit has been in your report. Having credit products in good standing for a long time (years) helps increase your score.
If you carry a balance on your credit cards. You can still have good credit if you carry a balance on your credit cards, but your score will be higher if you repay everything that’s owing each month.
If you regularly miss your minimum payments. This will make your score lower.
If you’re usually close to or above your credit limit. This also lowers your score. When all your credit is “maxed out” it indicates to lenders you may be under financial strain and have difficulty repaying your debt.
Slide 14: What influences my credit score?
Adds more factors:
Number of recent credit applications.
Types of credit used.
Accounts in collections.
Bankruptcy or consumer proposals.
Presenter:
Number of recent credit applications. The more applications, the lower your score.
Type of credit you’re using. Credit cards tend to build your credit score faster than any other type of loan, like a mortgage. And having a mix of credit types can help to keep your credit score high.
If your debts have gone to a collections agency. Even debt, like an unpaid phone bill, that goes to collections can lower your credit score.
If you’ve claimed bankruptcy or have had to go through a consumer proposal, your score will go down significantly.
Keep in mind, the changes to your score aren’t permanent. It’s continuously being recalculated.
Slide 15: How can I improve my credit score?
Tips include:
Make payments on time.
Don’t skip payments.
Pay at least the minimum.
Stay under 30% of your credit limit.
Keep older accounts open.
Limit credit checks.
Use a mix of credit types.
Presenter:
I think I can safely say that everyone wants to have a good credit score. Here are some considerations for increasing your credit score, whether you're building it for the first time, trying to raise it or trying to maintain a good score, the actions you take are the same.
#1 Make payments
Always make your payments on time.
Don’t skip a payment.
Pay at least the minimum that’s required.
#2 Use credit wisely
Don’t go over your limit.
Try to use less than 30% of what’s available to you.
#3 Keep older credit products open
Consider keeping an older credit product open, even if you don’t need it. Credit products that have been in good standing for a long time help your score.
#4 Limit checks
While it’s normal to apply for credit from time to time, do what you can to limit the number of checks you allow.
Get your quotes from different lenders within a 2-week period when you’re shopping around for a car loan or mortgage. When you do this, credit bureaus will combine and treat your inquiries as a single inquiry for your score.
#5 Diversify
It’s better to have a mix of credit products. Such as a credit card, a car loan and a line of credit.
Slide 16: How long information stays on your credit report
Explains:
Positive info stays as long as the account is open.
Closed accounts stay 10–20 years.
Negative info (e.g., late payments) stays 6 years.
Credit checks stay 3–6 years.
Bankruptcy stays 6–7 years.
Presenter:
As we discussed, your credit score is consistently evolving so it’s good to review how long information stays on your report.
First, the Positive information
Includes credit that you’ve paid as agreed and have no negative history for.
Depends on the type of information.
Active accounts stay on your report for as long as they're open.
Equifax reports closed accounts for 10 years and TransUnion for up to 20.
Negative information
Things that negatively impact your score, like late payments or accounts going to collections.
Negative information about accounts (like credit cards) stays on your report for 6 years.
Credit checks by lenders, Equifax reports it for 3 years and TransUnion for 6 years.
Bankruptcy stays on your report for 6 or 7 years, depending on the province.
No matter where you have been in the past, establishing and maintaining good debt habits overtime, will help your achieve a better rating.
Slide 17: Getting your debt under control
Introduces the section on managing debt, including six steps to tackle it.
Presenter:
At Canada Life, our mission is to improve the financial, mental and physical well being of Canadians. We know that financial stress is impacting a lot of Canadians.
If you’re struggling to pay off your debt or a lot of your income is going towards debt repayment, there are a few things that you can do to get your debt under control.
Slide 18: Six steps to tackle your debt
Lists six steps to tackle debt:
Make a list of debts
Create a budget
Choose a repayment strategy
Consolidate your debts
Stay on track
Get help if you need
Presenter:
In the following section we’ll cover 6 steps you can take to tackle your debt.
Slide 19: Make a list of your debts
Step 1 of 6. Suggests listing all debts with:
Name of debt.
Balance.
Interest rate.
Minimum payment. An example table is provided.
Presenter:
The first step of tackling your debt is to make a list of all your debts. For each one, you should note:
The total amount you owe
The minimum monthly payment and
The interest rate
You can also use the Financial Goal Calculator when you visit Canada.ca.
By making a list of your debts, you can get an accurate picture of your own situation – the types of debts you have and how it fits into your monthly budget.
Slide 20: Create a budget
Step 2 of 6. Defines budgeting as tracking income, expenses, and savings to reach financial goals.
Presenter:
Step 2 Budgeting
What is budgeting?
- Budgeting is the exercise of documenting all your monthly income, expenses and savings.
- Having a budget helps you spend with intention so you can reach your financial goals – like saving more or paying down debt.
Slide 21: What’s budgeting? How to make a budget
Explains how to:
Document income and expenses.
Use accurate or average numbers.
Identify areas to save.
Create and update a budget.
Presenter:
Making a budget might seem daunting but you can make it easier once you build the right habits and use the right tools. A budget is simply making a list of the income you earn or receive each month and comparing it to what you spend. To help you along, Canada Life has made a free budgeting worksheet available to you at canadalife.com/cashcalculator.
If you’re not sure where to start, here’s how to make a budget in three steps.
Step 1: Document what you earn and spend
Include income from all sources, like employment, spousal support and child tax credits.
Try to use accurate numbers for your expenses instead of guessing.
For expenses that change each month, use the average.
Step 2: Find areas where you can save
Once your income and expenses are documented it’s easier to find areas you can cut back spending.
Are you spending more than you earn? Are you spending with intention or have you made impulsive purchases? Are there any bills you can eliminate all together, like multiple streaming services, old subscriptions, or an unused gym membership?
Consider lifestyle changes to help you only spend what you can afford to.
Step 3: Make a budget
Turn your observations into a budget you can follow. If you’re using the budgeting worksheet, adjust it to reflect what you plan to spend on each item going forward.
Finally, update your budget when things change. For example, if you have a new ongoing expense to account for, or if your income increases.
Slide 22: Choose a debt repayment strategy
Step 3 of 6. Two strategies:
Lowest balance first: Motivating, improves cash flow, but may cost more in interest.
Highest interest first: Saves money long-term, but may take longer to feel relief.
Presenter:
If you have debt, then your budget should include how much of your income you plan to use to repay it. Your next step is in tackling your debt, it to choose a strategy for repaying it.
This is where your list of debts you did in the first step will come in handy. Use it in combination with your budget to help you decide which strategy will work best for you.
Pay debts with the lowest balances first
Helps keep you motivated to stay on track since you’ll feel the accomplishment of paying off a debt sooner.
It may improve your overall cashflow sooner since you’ll have fewer minimum payments to make earlier on.
Beware, with this strategy you may end up paying more interest over time.
Pay debts with the highest interest rates first
In theory, this strategy makes the most financial sense.
You’ll ultimately pay less interest which will help you become debt-free sooner.
But in some cases, it may not be the right way to go. For example, if you’re struggling to make your minimum payments, this method could take longer to provide relief since the focus is lowering interest costs and not the total number of debts you’re paying.
Slide 23: What’s debt consolidation?
Step 4 of 6. Describes debt consolidation:
Combining multiple debts into one.
Applying for a consolidation loan.
Presenter:
Step 4 – Consider consolidating your debts
What’s debt consolidation?
Debt consolidation is when you combine multiple smaller debts into one larger debt.
Work with your preferred lender to apply for a consolidation loan (or other debt product).
Slide 24: Consider consolidating your debts
Explains benefits:
Lower interest.
Better cash flow.
Easier tracking. Also notes challenges:
Harder to qualify.
Secured loans carry risk.
Lenders prefer consolidating their own debts.
Presenter:
So, how can consolidating debt help you? Here are some considerations:
First, the potential benefits of debt consolidation
Depending on the interest rates of your debts and the consolidation loan, it could lower the total amount of interest you pay.
It could improve your cashflow if your current minimum repayment requirements are higher than the singular payment would be.
It’s easier to keep track of one payment compared to several. This can make it easier to ensure your payments are made on time.
More considerations
It can be difficult to qualify for a consolidation loan, especially if your income and/or credit score is low.
Lenders are more likely to approve secured consolidation loans, for example adding your debt to your mortgage. It could be a great option, but keep in mind, if you can’t pay it, now your house is on the line.
Lenders are more likely to consolidate debt that’s already held by them.
Slide 25: Stay on track
Step 5 of 6. Tips:
Stick to your budget.
Plan for emergencies.
Avoid new debt.
Pay more than the minimum.
Presenter:
Managing debt is not a one-time exercise, it is something you will always need to be mindful of, and step 5 is information on how to build good habits and stay on track.
#1 Follow your budget and update it when things change. The longer you have a budget the more accurate your understanding of what your lifestyle costs.
#2 Plan for those emergencies. You do your best to manage your debt but life happens so it’s important to incorporate emergency savings into your and perhaps consider insurance to account for those unforeseen event.
#3 How about avoiding taking on more debt. If possible.
#4 Pay more than the minimum payments.
Slide 26: Example: Paying more than the minimum
Compares two repayment scenarios for a $5,000 credit card debt at 18% interest:
Minimum only: Takes nearly 19 years, costs $4,799 in interest.
Minimum + $100: Takes just over 3 years, saves $3,502 in interest.
Presenter:
You might be wondering why I’m suggesting you pay more than the minimums. It’s because some credit products like credit cards, have minimum payments that aren’t designed to help you pay repay your debt quickly.
On credit cards, your minimum payment will typically be the higher of a dollar amount or a percentage of your outstanding balance. By paying only the minimum payment amount, you’re extending the amount of time it will take to repay your debt and increasing the total amount of interest you’ll have paid.
Let’s look at an example to illustrate how paying more than your minimum can result in a lot of savings.
In this example we have a $5,000 balance on our credit card. The interest rate is 18% and the minimum payment required is the greater of $10 or 3% of your outstanding balance. In the first scenario we’ll pay only the minimum that’s required of us. In the second scenario we’ll pay the minimum plus an extra $100 each month.
As you can see, the extra $100 each month makes a big difference.
We’ve saved a lot of time. Instead of paying off our credit card balance in almost 19 years, we’re paying it off in just over 3.
And because we’re paying it sooner, we’re also saving in interest charges and will end up paying around $3,502.
Slide 27: Get help if you need it
Step 6 of 6. Encourages seeking help:
Credit counsellors offer advice.
Professionals can help with bankruptcy or consumer proposals.
Presenter:
The last step to consider, Step 6: Get help if you need it
Tackling debt can feel overwhelming – you don’t need to do it alone.
Credit counsellors can give you advice and help you make a strategy.
Professionals can help you decide if you need to take a bigger step than what we’ve talked about today.
Slide 28: Help with debt is included with your plan
Lists support resources:
Credit Counselling Society: nomoredebts.org, 1-877-636-8999.
Québec/Atlantic: solveyourdebts.com, 1-888-753-2227.
Presenter:
As a Canada Life group savings plan member, you have access to free and discounted credit counselling services from these non-profit organizations. The phone numbers you see on the screen are exclusive to Canada Life plan members. Or you can go to their websites to explore on your own.
The Credit Counselling Society is a non-profit service available to help you manage your expenses during challenging times. You'll get confidential one-on-one financial coaching. If you're in Quebec or the Atlantic provinces, contact Credit Counselling Services of Atlantic Canada.
Slide 29: Reduced fees for Canada Life plan members
Outlines fee reductions:
Free counselling.
Waived setup fees.
Monthly fees capped at 10% of deposit, up to $75.
Presenter:
Here are the fees for accessing their services. As shown, your plan gives you access to most services for free.
Slide 30: How will I know when my debt is under control and my financial well-being is good?
Indicators of financial well-being:
Meeting financial needs.
Resilience to future challenges.
Progress on goals.
Freedom to make life choices.
Presenter:
I hope you found this information useful. It can be so empowering when you feel positive about your financial future.
When your financial well-being is good, you’ve met your current commitments and needs comfortably and have the financial resilience to maintain this in the future. It can mean having control over your finances, being able to navigate a financial setback, meeting your financial goals or having the freedom to make choices that let you find balance in your life.
Slide 31: Questions?
Encourages reaching out for help. Provides a phone number and website for support. States that the information is general and educational. No guarantees are made about future outcomes.
Presenter:
That brings us to the end of our presentation. Thank you for watching. Be sure to check out our other webinars to keep learning about money and your group savings plan
Retirement is changing. We’re living longer, healthier lives which means there are more opportunities for our retired years than ever before.
This webinar dives into the details of retirement planning, including:
- Making a retirement budget
- Financial risks and considerations
- Estate planning basics
- Emotional readiness
Description:
This webinar is presented in ASL by a middle-aged man. He is standing in front of a grey screen with slides to his left. This webinar is provided by Canada Life and many of the slides have the Canada Life logo on them.
Slide 1: The slide features a photograph of a person working on pottery in a studio, with the text "Retirement Getting close" prominently displayed in red and white.
Presenter: Hi Everyone and welcome to the Retirement – getting close webinar!
Slide 2: The slide presents statistics about Canadians' perspectives on retirement. It highlights that 54% of Canadians see retirement as a new chapter in their lives, while 55% of retirees and pre-retirees aim to balance work and leisure. The slide includes sources for these statistics.
Presenter: Retirement is changing. We’re living longer, healthier lives which means there are more opportunities for our retired years than ever before.
In fact, many Canadians no longer see retirement as a time to solely focus on relaxation and winding down. A survey found that 54% of Canadians who are retired, or are close to retirement, see it as a new chapter in their lives. 55% of retirees and pre-retirees even plan to keep working in some capacity and want a balance of work and leisure in their retired life.
Today’s session will help you plan for a retirement that’s full of possibilities.
Slide 3:
The slide presents an agenda for a retirement-related presentation. The agenda includes four main topics: sources of retirement income, financial risks in retirement, making your wishes known, and retirement readiness. The slide features a red background with white text and a simple icon of six people in a circle.
Presenter: Here are the topics we’ll cover:
-We’ll start with a review of the different income sources you may be able to draw on in retirement.
- Then, we’ll review some of the key financial risks in retirement that you may be faced with. Knowing the risks can help you plan to minimize them.
- Making your wishes known to your loved ones is another important consideration as you age.
- Finally, we’ll talk about some steps you can take to make sure you’re ready to retire when the time comes.
Slide 4:
The slide outlines three sources of retirement income: government benefits, employer-sponsored plans, and personal savings. It includes a photograph of two people, one of whom is holding a tablet.
Presenter: In Canada, there are three main sources of retirement income.
The first are government benefits. They include programs like the Canada Pension Plan (known as CPP) for most Canadians, or the Québec Pension Plan (known as QPP) for those working in Quebec. The amount of CPP or QPP you can expect to receive will depend on your average earnings, what you’ve contributed while working and the age you start receiving it.
Government benefits also includes Old Age Security (or OAS). OAS benefits are based on the number of years you’ve lived in Canada after turning 18. You need to live in Canada for at least 10 years to receive it.
The next income source is savings you’ve accumulated in an employer-sponsored plan – like the one you have with Canada Life. The saving options are different from plan to plan, so it’s important to speak with your plan administrator to learn about the options available to you. Some plans even include employer contributions, where your employer saves on your behalf or matches a portion of what you save.
Finally, the third source of retirement income is personal savings. Personal savings can come from a variety of sources, like a registered retirement savings plan you have at your bank, money you have in a savings account or even a rental property you own.
Slide 5:
The slide titled "Sources of retirement income" illustrates the financial needs for income replacement during working and retirement years. It shows that earned income covers expenses during working years, while retirement years require income from personal savings, employer-sponsored plans, and government benefits to cover expenses. The slide emphasizes the importance of these sources in meeting financial needs during retirement.
Presenter: There are some common misconceptions about the different income sources. One common example is that government benefits will fully replace employment income when you retire. The reality is that they’re only designed to cover a portion of your income. The same goes for employer-sponsored plans. The amount they provide you with depends on how much you and your employer contribute while you’re still working and how much your savings grow over time. This slide shows how the three different income sources can work together to help you meet your expenses in retirement.
As you can see, even if you have savings in both an employer-sponsored plan and receive government benefits, you still may need additional income from personal savings to replace your income and cover all your expenses. This is why planning ahead and carving out personal savings is so important.
Slide 6:
The slide addresses the question, "How much do I need to save?" in the context of retirement. It lists several key considerations for retirement savings, including retirement age, housing, family considerations, transportation, obligations, legacy, continuing to work, and outstanding debt. Each consideration is accompanied by a relevant icon.
Presenter: While many of us will need to rely at least in part on our personal savings in retirement, the amount you need to save is different for everyone. It all depends on your plans for retirement and your personal situation. Things like your retirement age, how much you want to leave behind to loved ones to inherit and whether you plan to continue working part time, all have a big impact on how much you’ll need to save.
That’s why creating a retirement budget based on your individual circumstances is such an important step in the planning process.
Slide 7:
The slide titled "Imagine your retirement" presents four key questions to consider for retirement planning: What will give a sense of purpose when I retire? Do I want to stay in the community I’m living in or move somewhere else? Will I downsize my home? Will I continue to work after I retire? The slide features a background image of a person on a sailboat.
Presenter: When creating a budget for your retirement, start by imagining the retirement you’d like to have.
Here are some questions you can ask yourself to get started:
What will give me a sense of purpose when I retire?
Do I want to stay in the community I’m living in or move somewhere else?
Will I downsize my home?
Will I start a business after I retire or keep working part-time after I retire?
Slide 8:
The slide titled "Imagine your retirement" presents a list of reflective questions about retirement planning, including travel plans, staying engaged with important people, participating in activities, and financial considerations. The slide features a background image of a person on a sailboat.
Presenter:
What are my travel plans?
How will I stay engaged with the people who are most important to me?
What activities will I participate in?
Do I want to spend all my money or leave an inheritance for my loved ones?
The answers to these questions will help you determine how much income you’ll need to have to live the retirement lifestyle you envision for yourself. If you have a partner, be sure to involve them in the planning process.
Slide 9:
The slide provides instructions on how to set a retirement income goal using the "My Canada Life at Work" tool. It includes a screenshot of the web interface, showing the main "Overview" screen with options for contributions, savings, and resources. The interface displays a summary of savings and retirement goals, with a specific section on how to set retirement goals. The slide emphasizes the importance of planning for retirement and provides a visual guide to accessing the retirement goal tool.
Presenter: Once you’ve made a retirement budget, you can use the retirement goal tool on My Canada Life at Work to help you figure out how much you need to save. You can access it from the main Overview screen. Select Set my goal to get started.
Slide 10:
The slide provides instructions for managing a Canada Life group savings plan through the "My Canada Life at Work" portal. It instructs users to sign in using their Access ID and password and offers assistance via a tech line available Monday to Friday, 8 a.m. to 8 p.m. ET. The contact number for the tech line is 1-888-222-0775. The slide features a simple design with a dark gray background and white text, accompanied by a small icon of a laptop and document.
Presenter: If you’re not familiar with My Canada Life at Work, it’s your go-to website to manage your Canada Life group savings plan. In addition to using this tool, you can use it to retrieve statements, choose investments, add a beneficiary and more. If you have trouble signing in, give our tech line a call for help at 1-888-222-0775.
Slide 11:
The slide presents the results of a retirement goal tool from "Canada Life." It shows that the user has $4,158 estimated monthly retirement income and a $2,929 retirement income goal. The user is on track but is advised to keep saving and contribute more to retire earlier. The slide includes a bar chart comparing current and goal income and expenses, and it provides options to change personal information or save the goal.
Presenter: Once you’re done inputting all your information into the tool, it will give you one of two results.
The first is “Congratulations! You’re on track”. This means based on the information you’ve entered, the amount you’re saving will be enough to reach your retirement income goals. You can save your results and keep the calculator updated over time as things change.
The other result is “Save more to reach your goal!”. If you get this result, it doesn’t mean it’s time to panic. It means it’s time to review your strategy so you can make changes today that will get you closer to your savings goal and the retirement you dream for yourself. With the “Save more” result, the tool will let you know how much more you’ll need to save each month to reach your income goals.
Slide 12:
The slide emphasizes the importance of planning ahead for possible risks in retirement. It lists key financial risks such as debt, inflation, longevity, and asset mix. It also highlights the importance of investing in retirement. The slide includes an image of two people looking at a tablet, suggesting a focus on financial planning.
Presenter: Next, let’s talk about some of the risks you’ll face in retirement and ways you can invest to help manage them.
Slide 13:
The slide discusses the financial risks associated with debt, particularly focusing on the challenges retirees face due to reduced or fixed income. It highlights that repaying debt can be more difficult and harder to cope with when interest rates increase. To reduce the risk of debt, it suggests understanding the terms and conditions of debts, paying off as much as possible before retirement, creating a budget to avoid taking on more debt, and seeking help from credit counseling services if needed.
Presenter: The first risk is one you’re probably familiar with. It’s debt.
Debt is the amount of money you owe to whoever lent it to you. Usually, you’re required to pay interest in addition to the amount you owe when it comes time to repay it. Mortgages, car loans, credit cards and lines of credit are all examples of debt. We often hear of “good debt” and “bad debt”, but when you retire, any debt can be risky. This is because when you retire you may be living off a reduced or fixed income. While your income may be fairly stable, if the terms of your debt change, it could become difficult for you to make your payments. Think of recent mortgage rate increases. These increases cost some Canadians hundreds of dollars more each month. When you’re not working, those changes may be hard to compensate for.
Here are some things you can do to reduce the risk of debt in retirement:
- Review the terms and conditions of your debts, including how much you’re required to pay each month, the interest rates and if you’ll be required to pay it off at any point.
- Pay off as much of your debt as you can before you retire. You’ll want consider which debts have the highest rates and which ones have the biggest repayment requirements when you’re deciding what to pay first.
- Make a budget for today and retirement. Having a budget can help to keep your spending on track and avoid getting into more debt. It can also help you uncover areas where you can spend less and use the money to repay your debt.
- Finally, get help from credit counselling services if you need it.
Slide 14:
The slide provides information on credit counseling services available for members. It features two websites: "nomoredebts.org" with a contact number of 1-877-636-8999, and "solveyourdebts.com" with a contact number of 1-888-753-2227. The slide includes images of the websites' homepages and provides the relevant URLs and contact details for accessing these services.
Presenter: Since we’re on the topic of credit counselling, did you know that one of the perks of your Canada Life group savings plan is free access to support from credit counseling services?
Through these services you can get:
Help making a budget
Financial advice based on your situation
Tips to bring your budget in line with your goals
An action plan
Referrals to other services, if needed
If debt is something you’re struggling with, don’t hesitate to reach out and get help.
Slide 15:
The slide discusses the financial risks associated with inflation, particularly for retirees. It explains that inflation risk refers to the potential decrease in purchasing power over time as prices rise. Retirees may find that their income does not keep up with inflation. To protect against inflation risk, the slide suggests continuing to invest in retirement, reviewing and adjusting the retirement budget, and considering that some retirement income sources may increase over time to compensate for inflation. The source of this information is cited at the bottom of the slide.
Presenter: The next financial risk in retirement is inflation.
Inflation is the increase of prices over time. Recent increases of food prices is a good example of inflation. Just think of how much more a trip to the grocery store costs you now compared to before the pandemic. In fact, a recent study found 78% of Canadians feel their personal finances have worsened due to inflation.
The risk of inflation in retirement is that your purchasing power will reduce as prices go up while your income stays the same. You might eventually find that your income doesn’t stretch as far as it once did. There are a few things you can do to protect yourself from the impacts of inflation in retirement.
The first is to keep investing your money when you retire. While you’ll want to invest in a way that offers you more capital protection than when you were still working, you don’t have to stop choosing investment options that offer more growth potential altogether. Consider investing in equities after you retire, even if they represent a smaller portion of your overall portfolio.
Another way you can protect yourself from inflation is by sticking to a budget. Having a budget today can help you save more for the future. In retirement, a budget can help you quickly identify areas where your expenses are increasing and make changes when necessary.
Some of your income sources are indexed and will automatically protect you from inflation. This means they go up over time to account for inflation. Fortunately, government benefits are indexed. The government performs regular reviews of the amounts payable and will adjust it over time to keep up with the cost of living.
CPP and QPP are reviewed and may be adjusted January 1 of every year, whereas OAS is reviewed and may be adjusted quarterly, or 4 times per year.
Slide 16:
The slide discusses the financial risks associated with longevity, particularly for Canadians who are living longer and needing to make money last longer. It highlights the increased risk of outliving savings and provides strategies to reduce longevity risk, such as planning to an older age, diversifying investment portfolios, taking only what is needed from savings, and considering investment options that provide guaranteed income payments. The source of the information is cited at the bottom of the slide.
Presenter: A recent study by the Office of the Superintendent of Financial Institutions found that half of Canadians who are now twenty years old will live to 90 and one of every ten of them will live to 100. While Canadians living longer is great news, it means that longevity risk is also increasing. Longevity risk is the risk you’ll outlive your savings.
Fortunately, there are things you can do to plan for a longer lifespan:
- The first tip is an easy one. When you’re figuring out how much you’ll need to save for retirement, do your calculations based on an older age. Rather than using for example 80 years old, try 90 or even 100.
- The next strategy is to diversify your investment portfolio. You won’t need all your savings immediately when you retire, so your investment strategy can factor in a mix of types of investments based on your timeline. Be sure to work with a licenced financial advisor to map out your investing plan if you are not comfortable doing this yourself.
- Consider the amount of savings you are accessing each year. The more money you draw down in your early retirement years, the less you will have for your future self. Access what you need and invest the rest.
- There are different ways to draw down your income in retirement. Registered retirement income funds (RRIFs), life income funds (LIFs) and annuities all have different features and benefits. Understand your options so you can make the right selections, or mix of selections, for your needs.
Slide 17:
The slide discusses the importance of selecting the appropriate asset mix for investment portfolios to avoid financial risks. It defines an asset class and an asset mix, emphasizing that an incorrect asset mix can hinder the achievement of financial goals. The slide suggests completing the Investment Personality Questionnaire at canadalife.com/ipq to reduce investment risks. The background image depicts an older couple in an outdoor setting.
Presenter: The last financial risk we’ll review today is asset mix risk.
Before we do, let’s define a couple terms, starting with asset class. An asset class is a group of similar investments based on what they invest in or how they earn returns. Equities, fixed income and cash and equivalents are all examples of asset classes. Your asset mix is the mix of different asset classes you have in your investment portfolio.
Asset mix risk is the risk that the asset mix of your portfolio isn’t in line with your goals. For example, if you’re invested too conservatively, your savings may not provide you with opportunities for growth. If you’re invested too aggressively, your savings may go through periods where the value is reduced and the amount of income you receive is less. Finding the right asset mix is important to ensuring you have the right investments to provide you with income in the short term and growth in the long term.
Review the Investment Personality Questionnaire on a regular basis to ensure your portfolio is properly diversified and aligned with your financial goals. You’ll find the Investment Personality Questionnaire by logging into your Canada Life account or by going to canadalife.com/IPQ.
Slide 18:
The slide titled "Investing in retirement" provides four key points about retirement investing: Continue investing to manage longevity and inflation risk, diversification is crucial in retirement, do not stop investing in equities when you retire, and choose investment options based on your risk tolerance, potential for return, and when you will need the money. The slide includes icons representing each point and a source citation from "Investing during retirement (canadalife.com)."
Presenter: When you retire, you may be tempted to move all your savings over to less volatile investments, like bonds or guaranteed investments. But remember, your retirement may last a long time, and you won’t need all your money at once. Having a strategy that plans for both withdrawals in retirement and keeping some of your funds invested while you don’t need them, can help you manage risks like longevity and inflation.
To do this, you’ll need a mix of investments, or in other words, a diversified portfolio, including equites. Equity investments have historically offered investors the strongest returns over the long-term and not investing in them at all could mean you’re missing out on opportunities to grow your savings.
Managed solutions, like investment funds, are an easy way to diversity. They can help you diversify your portfolio by sector, geography and asset class without the hassle or risk of purchasing and tracking individual investments on your own. There are solutions designed for every investor, including those designed specifically for investors in retirement.
Choosing which investment options make sense for you in your retirement will depend on many factors, including your comfort with risk, the potential for return, potential volatility, and when you’ll need to use the money. As mentioned on the previous slide, you can review your risk tolerance by completing the Investment Personality Questionnaire available on the Canada Life website.
Slide 19:
The slide emphasizes the importance of making financial wishes known, specifically through a "My financial life" file and estate planning. It includes a photograph of two individuals discussing documents.
Presenter: At any age it’s important to make your wishes known but as you get older it becomes even more critical. In this part of our session, we’ll talk about a few ways you can leave your financial instructions for your loved ones.
Slide 20:
The slide provides guidance on creating a secure "My Financial Life" file. It lists the types of documents to include, such as bank statements, life insurance policies, contribution notices, loan statements, and pre-planned burial arrangements. It also suggests contact information for a lawyer, accountant or tax specialist, and financial advisor or planner. Additionally, it emphasizes the importance of keeping the file in a secure location, such as a safety deposit box.
Presenter: Something everyone should do is create a "My financial life" file or folder that details important financial information and contacts. You’ll want to include things like your banking information, your investment accounts, loan information, receipts for major purchases, details of your insurance policies and any other relevant financial and lifestyle planning you've put in place. An easy way to keep it up to date is by picking a month to replace the statements in your file folder each year. Statements already include contact information, balances and other important account information.
Once you’ve created your file, be sure to keep it somewhere very secure. If you store it in a safety deposit box, inform your power of attorney or loved ones where of where they can find it.
Slide 21:
The slide titled "Estate planning" explains the benefits of estate planning through a bulleted list and an image. The list highlights that estate planning helps protect assets, avoid family conflict, ensure tax-efficient transfer of wealth, and meet obligations when passing. An image on the slide shows two individuals discussing documents, emphasizing the practical aspect of estate planning.
Presenter: Estate planning is another important aspect of making your wishes known. Estate planning is arranging your affairs so that when you die, your property is preserved and distributed the way you want.
Estate planning is important because it helps:
Minimize disputes over your assets between those you leave behind
Ensure your loved ones are taken care of
Minimize your tax liabilities
Work with legal and tax professionals to help you meet your estate planning needs.
Slide 22:
The slide titled "Estate planning – What’s included?" outlines key components of estate planning, divided into three categories: Will, Power of Attorney, and Naming Beneficiaries. It explains that a will determines the distribution of assets without a will according to law, a power of attorney authorizes a person to make financial or medical decisions, and naming beneficiaries involves reviewing and considering relationships for life events. The slide also notes that provincial and federal pension rules and family law may influence these decisions.
Presenter: Part of estate planning is creating a will. A will is a written document, almost always on paper although the law can allow for limited exceptions. After you die, it tells those you leave behind who will receive assets you owned at the time of your death. If you have minor children, it can also say who you’d like to be their guardian. A will can also communicate other instructions, like your funeral arrangements. If you die without a will, by Canadian law you’re said to have died “intestate” which means there are no detailed instructions on how you want to distribute your property. When this happens, each province or territory has its own rules on how a person’s estate will be administered and the assets distributed. This process can often be long, complicated and expensive.
You will also want to consider naming a power of attorney. A power of attorney is a signed, legal document that gives one or more people you trust, the authority to make decisions on your behalf. If age or illness changes your ability to make decisions, a power of attorney could be a very important part of your estate plan.
If your power of attorney’s authority is for financial matters and property, unless you stipulate limitations in the power of attorney document, they can:
Do your banking
Manage your investments
Collect money owed to you
Buy or sell real estate on your behalf
Purchase consumer items
Sign cheques and other documents for you when you can’t sign yourself
If your power of attorney’s authority is for healthcare or personal matters, and if you become incapable of doing so, they can make personal care decisions including healthcare and medical treatment, diet, housing, clothing, hygiene and safety.
Your power of attorney can’t write or change your will, change your life insurance beneficiary without court approval or grant a new power of attorney to another person on your behalf.
Even with a will in place, you’ll also want to name beneficiaries on your financial accounts and insurance policies. This will expedite the distribution of your assets upon your death. A beneficiary will receive the proceeds of your account or insurance policy very quickly and those dollars will not be included as an asset for the purpose of calculating your estate and taxes. It’s important to review your list of named beneficiaries whenever there’s a life event, such as a birth of a child, marriage, divorce or death. Not naming a beneficiary means that the assets will be paid to your estate.
Slide 23:
The slide promotes a service for creating a legal will online, highlighting a discounted rate for Canada Life plan members, access to a digital vault with unlimited edits, and the inclusion of attorney documents. It also offers estate planning services with personalized guidance and a 5% discount for Canada Life members. Additionally, the service provides free online executor support valued at $80. The slide features a background image of two people embracing and icons representing the services offered.
Presenter: The great news is that as a member of a Canada Life group savings plan, you receive an exclusive discount offer on wills and estate plan services. This online estate planning service gives you the ability to:
Create a legal will online at a one-time only discounted rate of $50+ HST (the regular price is usually $249+ HST).
They also offer:
For $19/year, access to a digital vault and unlimited edits to your will so you can make changes as your personal situation evolves
Includes power of attorney documents
Estate planning
Personalized guidance and support from estate experts
Preferred pricing with a 5% discount for services for Canada Life members
Executor support
Free online executor support for you or your appointed executor ($80 value)
Slide 24:
The slide provides instructions for accessing wills and estate planning services online through My Canada Life at Work. It outlines three steps: signing in, selecting options, and learning more about protecting your family's future. A screenshot of the My Canada Life interface highlights the "Protect your family’s future" section, which offers options for creating a will or planning an estate with professional guidance.
Presenter: To benefit from the discounted rates for wills and estate planning services, you must use the links provided within your account on My Canada Life at Work.
Go to the links under the “Options for you” tab when you sign in to learn more.
Slide 25:
The slide focuses on "Retirement readiness" and includes three key points: the retirement transition process, planning for a mentally healthy retirement, and a retirement checklist. An image of two people looking at a smartphone is on the left side.
Presenter: This brings us to the last topic of today’s webinar – retirement readiness and the retirement transition process.
Slide 26:
The slide outlines the retirement transition process for Canada Life, detailing five steps: receiving a retirement notice from the employer, Canada Life sending a package of options, selecting an option, notifying Canada Life, and finally transferring savings or income. The process is visually represented in a horizontal flowchart with each step numbered and color-coded.
Presenter: The first step is to notify your employer of your expected retirement date. Once you’ve notified your employer of your retirement date, they’ll reach out to Canada Life. This will prompt us to prepare an options package for you that you’ll receive once you’ve gotten your final pay cheque from your employer. In your package you'll find all the details that relate to your group savings plans, including your balances, specific retirement income options and any decision deadlines.
You’ll have time to review your options and work with your personal or group financial advisor. If you don’t have a financial advisor, there is a team of specialists at Canada Life available to assist you.
Slide 27:
The slide emphasizes the importance of working with a financial advisor to create a custom retirement savings plan. It provides a list of questions to consider when selecting an advisor, such as their qualifications, the products they offer, associated costs, investment philosophy, and how they can assist with retirement goals. The slide includes an image of two people in a meeting and cites the source of the information as "Meeting with an advisor (canadalife.com).”
Presenter: Some of us are comfortable and confident with the various steps and considerations leading into retirement and reviewing investments, the reality is that most of us are not. There are some important decisions to make when you are transitioning from working to retirement so be sure to work with licensed financial professionals to obtain investment and tax advice.
Be sure to work with professionals with whom you feel comfortable asking any and all questions, and that you trust their expertise and you feel knowledgeable and confident moving forward with your retirement plan.
Slide 28:
The slide titled "Planning for a mentally healthy retirement" outlines four key areas for consideration: Relationships and contribution, Living comfortably, Recreation, and Health and well-being. Each area is represented by an icon and a label. The slide emphasizes the importance of these aspects in planning for a mentally healthy retirement. The source of the information is cited at the bottom.
Presenter: You may be feeling financially prepared for your retirement but are you also feeling mentally prepared? We often dream of our retirement during our working years, but for some it can be a difficult transition. It’s important to also plan for a mentally healthy retirement.
According to Workplace Strategies for Mental Health, there are four key areas to plan for to assist with a mentally healthy retirement.
First, imagine your relationships . List the people you most want included in your life after retirement. What can you bring to their lives and what can they contribute to yours? Are there any people you would want to reconnect with when you have the time such as childhood friends or distant family? How can you contribute to your loved ones lives? Or in other words, what could you do that they might appreciate and that you may not have been able to do while you were working.
Next, consider the sustainability of your current living arrangements from several perspectives such as upkeep, financial demands, physical demands, access to transportation, proximity to family and friends and access to healthcare. Also consider that wait times for retirement residences may be lengthy, if this is part of your plan consider applying well in advance. Lastly, if you ever want to augment your income in retirement, list the skills you have acquired over the years and consider how these might be applied to future part-time, casual or consulting work.
Recreation is important for your physical health but don’t overlook its importance on your mental health. List the activities you would find enjoyable on your own, such as walking, travel, pets, etc. as well as activities and hobbies to enjoy with others.
Lastly, under health and well-being, think about your daily routine. Supporting both your physical and mental health should be factored into it. How do you want to feel most mornings when you wake up? How do you want to feel most evenings when you are ready to sleep?
For more details about planning for a mentally healthy retirement, check out the Workplace Strategies for Mental Health. It’s an online resource available to all Canadians at no cost courtesy of Canada Life. On it you can find a Retiring Well Questionnaire to help guide you through the non-financial aspects of retirement.
Slide 29:
The slide presents a "Retirement checklist" with four key actions employees should take as they approach retirement. These actions include notifying their employer, reviewing group and personal savings, updating beneficiary information, and applying for government benefits. The slide features a red background with white text and icons, and includes a crown icon above the title .
Presenter: Lets wrap up today’s session with a checklist you can use to make sure you’re retirement-ready.
The first thing on the checklist is to notify your employer that you’re retiring, ideally up to a year in advance.
Next is to review your beneficiaries on all plans, policies and wills. And don't forget about your investments. Are there adjustments to be made?
Finally, if you’re approaching retirement and you haven't done so already, apply for government benefits so the process can get started well before you expect to receive your first payments.
Slide 30:
The slide provides information on tools, resources, and support available from Canada Life. It includes contact details for Canada Life's tech and customer service lines, a member website URL, and resources for retirement education such as articles, calculators, videos, and links to external resources. The slide also features a logo and a background image of a person using a tablet.
Presenter: When it comes to retiring there’s a lot of information to review and decisions to make. Fortunately, there’s plenty of support available to you as a Canada Life group savings plan member.
For help, call our main support line at 1-800-724-3402.
To create a retirement goal, research and/or change your investment options, access your statements and more, sign in to mycanadalifeatwork.com.
And, if you want to keep learning more about key steps and important considerations as you are getting close to retirement, visit canadalife.com/smartpath where you’ll find articles, videos and calculators to support you in your retirement readiness journey.
Slide 31:
The slide provides contact information for questions, featuring a phone number (1-800-724-3402) and a website (mycanadalifeatwork.com). It includes a disclaimer about the general nature of the information and trademarks by The Canada Life Assurance Company. The slide has a teal background with a white text box on the left containing the word "Questions?" and a speech bubble icon on the bottom left.
Presenter: Thank you for joining us today! I hope you have some take aways and considerations as you countdown to your retirement.
Description:
This webinar is presented in ASL by a middle-aged man. He is standing in front of a grey screen with slides to his left. This webinar is provided by Canada Life and many of the slides have the Canada Life logo on them.
Slide 1: The slide features a photograph of a person working on pottery in a studio, with the text "Retirement Getting close" prominently displayed in red and white.
Presenter: Hi Everyone and welcome to the Retirement – getting close webinar!
Slide 2: The slide presents statistics about Canadians' perspectives on retirement. It highlights that 54% of Canadians see retirement as a new chapter in their lives, while 55% of retirees and pre-retirees aim to balance work and leisure. The slide includes sources for these statistics.
Presenter: Retirement is changing. We’re living longer, healthier lives which means there are more opportunities for our retired years than ever before.
In fact, many Canadians no longer see retirement as a time to solely focus on relaxation and winding down. A survey found that 54% of Canadians who are retired, or are close to retirement, see it as a new chapter in their lives. 55% of retirees and pre-retirees even plan to keep working in some capacity and want a balance of work and leisure in their retired life.
Today’s session will help you plan for a retirement that’s full of possibilities.
Slide 3:
The slide presents an agenda for a retirement-related presentation. The agenda includes four main topics: sources of retirement income, financial risks in retirement, making your wishes known, and retirement readiness. The slide features a red background with white text and a simple icon of six people in a circle.
Presenter: Here are the topics we’ll cover:
-We’ll start with a review of the different income sources you may be able to draw on in retirement.
- Then, we’ll review some of the key financial risks in retirement that you may be faced with. Knowing the risks can help you plan to minimize them.
- Making your wishes known to your loved ones is another important consideration as you age.
- Finally, we’ll talk about some steps you can take to make sure you’re ready to retire when the time comes.
Slide 4:
The slide outlines three sources of retirement income: government benefits, employer-sponsored plans, and personal savings. It includes a photograph of two people, one of whom is holding a tablet.
Presenter: In Canada, there are three main sources of retirement income.
The first are government benefits. They include programs like the Canada Pension Plan (known as CPP) for most Canadians, or the Québec Pension Plan (known as QPP) for those working in Quebec. The amount of CPP or QPP you can expect to receive will depend on your average earnings, what you’ve contributed while working and the age you start receiving it.
Government benefits also includes Old Age Security (or OAS). OAS benefits are based on the number of years you’ve lived in Canada after turning 18. You need to live in Canada for at least 10 years to receive it.
The next income source is savings you’ve accumulated in an employer-sponsored plan – like the one you have with Canada Life. The saving options are different from plan to plan, so it’s important to speak with your plan administrator to learn about the options available to you. Some plans even include employer contributions, where your employer saves on your behalf or matches a portion of what you save.
Finally, the third source of retirement income is personal savings. Personal savings can come from a variety of sources, like a registered retirement savings plan you have at your bank, money you have in a savings account or even a rental property you own.
Slide 5:
The slide titled "Sources of retirement income" illustrates the financial needs for income replacement during working and retirement years. It shows that earned income covers expenses during working years, while retirement years require income from personal savings, employer-sponsored plans, and government benefits to cover expenses. The slide emphasizes the importance of these sources in meeting financial needs during retirement.
Presenter: There are some common misconceptions about the different income sources. One common example is that government benefits will fully replace employment income when you retire. The reality is that they’re only designed to cover a portion of your income. The same goes for employer-sponsored plans. The amount they provide you with depends on how much you and your employer contribute while you’re still working and how much your savings grow over time. This slide shows how the three different income sources can work together to help you meet your expenses in retirement.
As you can see, even if you have savings in both an employer-sponsored plan and receive government benefits, you still may need additional income from personal savings to replace your income and cover all your expenses. This is why planning ahead and carving out personal savings is so important.
Slide 6:
The slide addresses the question, "How much do I need to save?" in the context of retirement. It lists several key considerations for retirement savings, including retirement age, housing, family considerations, transportation, obligations, legacy, continuing to work, and outstanding debt. Each consideration is accompanied by a relevant icon.
Presenter: While many of us will need to rely at least in part on our personal savings in retirement, the amount you need to save is different for everyone. It all depends on your plans for retirement and your personal situation. Things like your retirement age, how much you want to leave behind to loved ones to inherit and whether you plan to continue working part time, all have a big impact on how much you’ll need to save.
That’s why creating a retirement budget based on your individual circumstances is such an important step in the planning process.
Slide 7:
The slide titled "Imagine your retirement" presents four key questions to consider for retirement planning: What will give a sense of purpose when I retire? Do I want to stay in the community I’m living in or move somewhere else? Will I downsize my home? Will I continue to work after I retire? The slide features a background image of a person on a sailboat.
Presenter: When creating a budget for your retirement, start by imagining the retirement you’d like to have.
Here are some questions you can ask yourself to get started:
What will give me a sense of purpose when I retire?
Do I want to stay in the community I’m living in or move somewhere else?
Will I downsize my home?
Will I start a business after I retire or keep working part-time after I retire?
Slide 8:
The slide titled "Imagine your retirement" presents a list of reflective questions about retirement planning, including travel plans, staying engaged with important people, participating in activities, and financial considerations. The slide features a background image of a person on a sailboat.
Presenter:
What are my travel plans?
How will I stay engaged with the people who are most important to me?
What activities will I participate in?
Do I want to spend all my money or leave an inheritance for my loved ones?
The answers to these questions will help you determine how much income you’ll need to have to live the retirement lifestyle you envision for yourself. If you have a partner, be sure to involve them in the planning process.
Slide 9:
The slide provides instructions on how to set a retirement income goal using the "My Canada Life at Work" tool. It includes a screenshot of the web interface, showing the main "Overview" screen with options for contributions, savings, and resources. The interface displays a summary of savings and retirement goals, with a specific section on how to set retirement goals. The slide emphasizes the importance of planning for retirement and provides a visual guide to accessing the retirement goal tool.
Presenter: Once you’ve made a retirement budget, you can use the retirement goal tool on My Canada Life at Work to help you figure out how much you need to save. You can access it from the main Overview screen. Select Set my goal to get started.
Slide 10:
The slide provides instructions for managing a Canada Life group savings plan through the "My Canada Life at Work" portal. It instructs users to sign in using their Access ID and password and offers assistance via a tech line available Monday to Friday, 8 a.m. to 8 p.m. ET. The contact number for the tech line is 1-888-222-0775. The slide features a simple design with a dark gray background and white text, accompanied by a small icon of a laptop and document.
Presenter: If you’re not familiar with My Canada Life at Work, it’s your go-to website to manage your Canada Life group savings plan. In addition to using this tool, you can use it to retrieve statements, choose investments, add a beneficiary and more. If you have trouble signing in, give our tech line a call for help at 1-888-222-0775.
Slide 11:
The slide presents the results of a retirement goal tool from "Canada Life." It shows that the user has $4,158 estimated monthly retirement income and a $2,929 retirement income goal. The user is on track but is advised to keep saving and contribute more to retire earlier. The slide includes a bar chart comparing current and goal income and expenses, and it provides options to change personal information or save the goal.
Presenter: Once you’re done inputting all your information into the tool, it will give you one of two results.
The first is “Congratulations! You’re on track”. This means based on the information you’ve entered, the amount you’re saving will be enough to reach your retirement income goals. You can save your results and keep the calculator updated over time as things change.
The other result is “Save more to reach your goal!”. If you get this result, it doesn’t mean it’s time to panic. It means it’s time to review your strategy so you can make changes today that will get you closer to your savings goal and the retirement you dream for yourself. With the “Save more” result, the tool will let you know how much more you’ll need to save each month to reach your income goals.
Slide 12:
The slide emphasizes the importance of planning ahead for possible risks in retirement. It lists key financial risks such as debt, inflation, longevity, and asset mix. It also highlights the importance of investing in retirement. The slide includes an image of two people looking at a tablet, suggesting a focus on financial planning.
Presenter: Next, let’s talk about some of the risks you’ll face in retirement and ways you can invest to help manage them.
Slide 13:
The slide discusses the financial risks associated with debt, particularly focusing on the challenges retirees face due to reduced or fixed income. It highlights that repaying debt can be more difficult and harder to cope with when interest rates increase. To reduce the risk of debt, it suggests understanding the terms and conditions of debts, paying off as much as possible before retirement, creating a budget to avoid taking on more debt, and seeking help from credit counseling services if needed.
Presenter: The first risk is one you’re probably familiar with. It’s debt.
Debt is the amount of money you owe to whoever lent it to you. Usually, you’re required to pay interest in addition to the amount you owe when it comes time to repay it. Mortgages, car loans, credit cards and lines of credit are all examples of debt. We often hear of “good debt” and “bad debt”, but when you retire, any debt can be risky. This is because when you retire you may be living off a reduced or fixed income. While your income may be fairly stable, if the terms of your debt change, it could become difficult for you to make your payments. Think of recent mortgage rate increases. These increases cost some Canadians hundreds of dollars more each month. When you’re not working, those changes may be hard to compensate for.
Here are some things you can do to reduce the risk of debt in retirement:
- Review the terms and conditions of your debts, including how much you’re required to pay each month, the interest rates and if you’ll be required to pay it off at any point.
- Pay off as much of your debt as you can before you retire. You’ll want consider which debts have the highest rates and which ones have the biggest repayment requirements when you’re deciding what to pay first.
- Make a budget for today and retirement. Having a budget can help to keep your spending on track and avoid getting into more debt. It can also help you uncover areas where you can spend less and use the money to repay your debt.
- Finally, get help from credit counselling services if you need it.
Slide 14:
The slide provides information on credit counseling services available for members. It features two websites: "nomoredebts.org" with a contact number of 1-877-636-8999, and "solveyourdebts.com" with a contact number of 1-888-753-2227. The slide includes images of the websites' homepages and provides the relevant URLs and contact details for accessing these services.
Presenter: Since we’re on the topic of credit counselling, did you know that one of the perks of your Canada Life group savings plan is free access to support from credit counseling services?
Through these services you can get:
Help making a budget
Financial advice based on your situation
Tips to bring your budget in line with your goals
An action plan
Referrals to other services, if needed
If debt is something you’re struggling with, don’t hesitate to reach out and get help.
Slide 15:
The slide discusses the financial risks associated with inflation, particularly for retirees. It explains that inflation risk refers to the potential decrease in purchasing power over time as prices rise. Retirees may find that their income does not keep up with inflation. To protect against inflation risk, the slide suggests continuing to invest in retirement, reviewing and adjusting the retirement budget, and considering that some retirement income sources may increase over time to compensate for inflation. The source of this information is cited at the bottom of the slide.
Presenter: The next financial risk in retirement is inflation.
Inflation is the increase of prices over time. Recent increases of food prices is a good example of inflation. Just think of how much more a trip to the grocery store costs you now compared to before the pandemic. In fact, a recent study found 78% of Canadians feel their personal finances have worsened due to inflation.
The risk of inflation in retirement is that your purchasing power will reduce as prices go up while your income stays the same. You might eventually find that your income doesn’t stretch as far as it once did. There are a few things you can do to protect yourself from the impacts of inflation in retirement.
The first is to keep investing your money when you retire. While you’ll want to invest in a way that offers you more capital protection than when you were still working, you don’t have to stop choosing investment options that offer more growth potential altogether. Consider investing in equities after you retire, even if they represent a smaller portion of your overall portfolio.
Another way you can protect yourself from inflation is by sticking to a budget. Having a budget today can help you save more for the future. In retirement, a budget can help you quickly identify areas where your expenses are increasing and make changes when necessary.
Some of your income sources are indexed and will automatically protect you from inflation. This means they go up over time to account for inflation. Fortunately, government benefits are indexed. The government performs regular reviews of the amounts payable and will adjust it over time to keep up with the cost of living.
CPP and QPP are reviewed and may be adjusted January 1 of every year, whereas OAS is reviewed and may be adjusted quarterly, or 4 times per year.
Slide 16:
The slide discusses the financial risks associated with longevity, particularly for Canadians who are living longer and needing to make money last longer. It highlights the increased risk of outliving savings and provides strategies to reduce longevity risk, such as planning to an older age, diversifying investment portfolios, taking only what is needed from savings, and considering investment options that provide guaranteed income payments. The source of the information is cited at the bottom of the slide.
Presenter: A recent study by the Office of the Superintendent of Financial Institutions found that half of Canadians who are now twenty years old will live to 90 and one of every ten of them will live to 100. While Canadians living longer is great news, it means that longevity risk is also increasing. Longevity risk is the risk you’ll outlive your savings.
Fortunately, there are things you can do to plan for a longer lifespan:
- The first tip is an easy one. When you’re figuring out how much you’ll need to save for retirement, do your calculations based on an older age. Rather than using for example 80 years old, try 90 or even 100.
- The next strategy is to diversify your investment portfolio. You won’t need all your savings immediately when you retire, so your investment strategy can factor in a mix of types of investments based on your timeline. Be sure to work with a licenced financial advisor to map out your investing plan if you are not comfortable doing this yourself.
- Consider the amount of savings you are accessing each year. The more money you draw down in your early retirement years, the less you will have for your future self. Access what you need and invest the rest.
- There are different ways to draw down your income in retirement. Registered retirement income funds (RRIFs), life income funds (LIFs) and annuities all have different features and benefits. Understand your options so you can make the right selections, or mix of selections, for your needs.
Slide 17:
The slide discusses the importance of selecting the appropriate asset mix for investment portfolios to avoid financial risks. It defines an asset class and an asset mix, emphasizing that an incorrect asset mix can hinder the achievement of financial goals. The slide suggests completing the Investment Personality Questionnaire at canadalife.com/ipq to reduce investment risks. The background image depicts an older couple in an outdoor setting.
Presenter: The last financial risk we’ll review today is asset mix risk.
Before we do, let’s define a couple terms, starting with asset class. An asset class is a group of similar investments based on what they invest in or how they earn returns. Equities, fixed income and cash and equivalents are all examples of asset classes. Your asset mix is the mix of different asset classes you have in your investment portfolio.
Asset mix risk is the risk that the asset mix of your portfolio isn’t in line with your goals. For example, if you’re invested too conservatively, your savings may not provide you with opportunities for growth. If you’re invested too aggressively, your savings may go through periods where the value is reduced and the amount of income you receive is less. Finding the right asset mix is important to ensuring you have the right investments to provide you with income in the short term and growth in the long term.
Review the Investment Personality Questionnaire on a regular basis to ensure your portfolio is properly diversified and aligned with your financial goals. You’ll find the Investment Personality Questionnaire by logging into your Canada Life account or by going to canadalife.com/IPQ.
Slide 18:
The slide titled "Investing in retirement" provides four key points about retirement investing: Continue investing to manage longevity and inflation risk, diversification is crucial in retirement, do not stop investing in equities when you retire, and choose investment options based on your risk tolerance, potential for return, and when you will need the money. The slide includes icons representing each point and a source citation from "Investing during retirement (canadalife.com)."
Presenter: When you retire, you may be tempted to move all your savings over to less volatile investments, like bonds or guaranteed investments. But remember, your retirement may last a long time, and you won’t need all your money at once. Having a strategy that plans for both withdrawals in retirement and keeping some of your funds invested while you don’t need them, can help you manage risks like longevity and inflation.
To do this, you’ll need a mix of investments, or in other words, a diversified portfolio, including equites. Equity investments have historically offered investors the strongest returns over the long-term and not investing in them at all could mean you’re missing out on opportunities to grow your savings.
Managed solutions, like investment funds, are an easy way to diversity. They can help you diversify your portfolio by sector, geography and asset class without the hassle or risk of purchasing and tracking individual investments on your own. There are solutions designed for every investor, including those designed specifically for investors in retirement.
Choosing which investment options make sense for you in your retirement will depend on many factors, including your comfort with risk, the potential for return, potential volatility, and when you’ll need to use the money. As mentioned on the previous slide, you can review your risk tolerance by completing the Investment Personality Questionnaire available on the Canada Life website.
Slide 19:
The slide emphasizes the importance of making financial wishes known, specifically through a "My financial life" file and estate planning. It includes a photograph of two individuals discussing documents.
Presenter: At any age it’s important to make your wishes known but as you get older it becomes even more critical. In this part of our session, we’ll talk about a few ways you can leave your financial instructions for your loved ones.
Slide 20:
The slide provides guidance on creating a secure "My Financial Life" file. It lists the types of documents to include, such as bank statements, life insurance policies, contribution notices, loan statements, and pre-planned burial arrangements. It also suggests contact information for a lawyer, accountant or tax specialist, and financial advisor or planner. Additionally, it emphasizes the importance of keeping the file in a secure location, such as a safety deposit box.
Presenter: Something everyone should do is create a "My financial life" file or folder that details important financial information and contacts. You’ll want to include things like your banking information, your investment accounts, loan information, receipts for major purchases, details of your insurance policies and any other relevant financial and lifestyle planning you've put in place. An easy way to keep it up to date is by picking a month to replace the statements in your file folder each year. Statements already include contact information, balances and other important account information.
Once you’ve created your file, be sure to keep it somewhere very secure. If you store it in a safety deposit box, inform your power of attorney or loved ones where of where they can find it.
Slide 21:
The slide titled "Estate planning" explains the benefits of estate planning through a bulleted list and an image. The list highlights that estate planning helps protect assets, avoid family conflict, ensure tax-efficient transfer of wealth, and meet obligations when passing. An image on the slide shows two individuals discussing documents, emphasizing the practical aspect of estate planning.
Presenter: Estate planning is another important aspect of making your wishes known. Estate planning is arranging your affairs so that when you die, your property is preserved and distributed the way you want.
Estate planning is important because it helps:
Minimize disputes over your assets between those you leave behind
Ensure your loved ones are taken care of
Minimize your tax liabilities
Work with legal and tax professionals to help you meet your estate planning needs.
Slide 22:
The slide titled "Estate planning – What’s included?" outlines key components of estate planning, divided into three categories: Will, Power of Attorney, and Naming Beneficiaries. It explains that a will determines the distribution of assets without a will according to law, a power of attorney authorizes a person to make financial or medical decisions, and naming beneficiaries involves reviewing and considering relationships for life events. The slide also notes that provincial and federal pension rules and family law may influence these decisions.
Presenter: Part of estate planning is creating a will. A will is a written document, almost always on paper although the law can allow for limited exceptions. After you die, it tells those you leave behind who will receive assets you owned at the time of your death. If you have minor children, it can also say who you’d like to be their guardian. A will can also communicate other instructions, like your funeral arrangements. If you die without a will, by Canadian law you’re said to have died “intestate” which means there are no detailed instructions on how you want to distribute your property. When this happens, each province or territory has its own rules on how a person’s estate will be administered and the assets distributed. This process can often be long, complicated and expensive.
You will also want to consider naming a power of attorney. A power of attorney is a signed, legal document that gives one or more people you trust, the authority to make decisions on your behalf. If age or illness changes your ability to make decisions, a power of attorney could be a very important part of your estate plan.
If your power of attorney’s authority is for financial matters and property, unless you stipulate limitations in the power of attorney document, they can:
Do your banking
Manage your investments
Collect money owed to you
Buy or sell real estate on your behalf
Purchase consumer items
Sign cheques and other documents for you when you can’t sign yourself
If your power of attorney’s authority is for healthcare or personal matters, and if you become incapable of doing so, they can make personal care decisions including healthcare and medical treatment, diet, housing, clothing, hygiene and safety.
Your power of attorney can’t write or change your will, change your life insurance beneficiary without court approval or grant a new power of attorney to another person on your behalf.
Even with a will in place, you’ll also want to name beneficiaries on your financial accounts and insurance policies. This will expedite the distribution of your assets upon your death. A beneficiary will receive the proceeds of your account or insurance policy very quickly and those dollars will not be included as an asset for the purpose of calculating your estate and taxes. It’s important to review your list of named beneficiaries whenever there’s a life event, such as a birth of a child, marriage, divorce or death. Not naming a beneficiary means that the assets will be paid to your estate.
Slide 23:
The slide promotes a service for creating a legal will online, highlighting a discounted rate for Canada Life plan members, access to a digital vault with unlimited edits, and the inclusion of attorney documents. It also offers estate planning services with personalized guidance and a 5% discount for Canada Life members. Additionally, the service provides free online executor support valued at $80. The slide features a background image of two people embracing and icons representing the services offered.
Presenter: The great news is that as a member of a Canada Life group savings plan, you receive an exclusive discount offer on wills and estate plan services. This online estate planning service gives you the ability to:
Create a legal will online at a one-time only discounted rate of $50+ HST (the regular price is usually $249+ HST).
They also offer:
For $19/year, access to a digital vault and unlimited edits to your will so you can make changes as your personal situation evolves
Includes power of attorney documents
Estate planning
Personalized guidance and support from estate experts
Preferred pricing with a 5% discount for services for Canada Life members
Executor support
Free online executor support for you or your appointed executor ($80 value)
Slide 24:
The slide provides instructions for accessing wills and estate planning services online through My Canada Life at Work. It outlines three steps: signing in, selecting options, and learning more about protecting your family's future. A screenshot of the My Canada Life interface highlights the "Protect your family’s future" section, which offers options for creating a will or planning an estate with professional guidance.
Presenter: To benefit from the discounted rates for wills and estate planning services, you must use the links provided within your account on My Canada Life at Work.
Go to the links under the “Options for you” tab when you sign in to learn more.
Slide 25:
The slide focuses on "Retirement readiness" and includes three key points: the retirement transition process, planning for a mentally healthy retirement, and a retirement checklist. An image of two people looking at a smartphone is on the left side.
Presenter: This brings us to the last topic of today’s webinar – retirement readiness and the retirement transition process.
Slide 26:
The slide outlines the retirement transition process for Canada Life, detailing five steps: receiving a retirement notice from the employer, Canada Life sending a package of options, selecting an option, notifying Canada Life, and finally transferring savings or income. The process is visually represented in a horizontal flowchart with each step numbered and color-coded.
Presenter: The first step is to notify your employer of your expected retirement date. Once you’ve notified your employer of your retirement date, they’ll reach out to Canada Life. This will prompt us to prepare an options package for you that you’ll receive once you’ve gotten your final pay cheque from your employer. In your package you'll find all the details that relate to your group savings plans, including your balances, specific retirement income options and any decision deadlines.
You’ll have time to review your options and work with your personal or group financial advisor. If you don’t have a financial advisor, there is a team of specialists at Canada Life available to assist you.
Slide 27:
The slide emphasizes the importance of working with a financial advisor to create a custom retirement savings plan. It provides a list of questions to consider when selecting an advisor, such as their qualifications, the products they offer, associated costs, investment philosophy, and how they can assist with retirement goals. The slide includes an image of two people in a meeting and cites the source of the information as "Meeting with an advisor (canadalife.com).”
Presenter: Some of us are comfortable and confident with the various steps and considerations leading into retirement and reviewing investments, the reality is that most of us are not. There are some important decisions to make when you are transitioning from working to retirement so be sure to work with licensed financial professionals to obtain investment and tax advice.
Be sure to work with professionals with whom you feel comfortable asking any and all questions, and that you trust their expertise and you feel knowledgeable and confident moving forward with your retirement plan.
Slide 28:
The slide titled "Planning for a mentally healthy retirement" outlines four key areas for consideration: Relationships and contribution, Living comfortably, Recreation, and Health and well-being. Each area is represented by an icon and a label. The slide emphasizes the importance of these aspects in planning for a mentally healthy retirement. The source of the information is cited at the bottom.
Presenter: You may be feeling financially prepared for your retirement but are you also feeling mentally prepared? We often dream of our retirement during our working years, but for some it can be a difficult transition. It’s important to also plan for a mentally healthy retirement.
According to Workplace Strategies for Mental Health, there are four key areas to plan for to assist with a mentally healthy retirement.
First, imagine your relationships . List the people you most want included in your life after retirement. What can you bring to their lives and what can they contribute to yours? Are there any people you would want to reconnect with when you have the time such as childhood friends or distant family? How can you contribute to your loved ones lives? Or in other words, what could you do that they might appreciate and that you may not have been able to do while you were working.
Next, consider the sustainability of your current living arrangements from several perspectives such as upkeep, financial demands, physical demands, access to transportation, proximity to family and friends and access to healthcare. Also consider that wait times for retirement residences may be lengthy, if this is part of your plan consider applying well in advance. Lastly, if you ever want to augment your income in retirement, list the skills you have acquired over the years and consider how these might be applied to future part-time, casual or consulting work.
Recreation is important for your physical health but don’t overlook its importance on your mental health. List the activities you would find enjoyable on your own, such as walking, travel, pets, etc. as well as activities and hobbies to enjoy with others.
Lastly, under health and well-being, think about your daily routine. Supporting both your physical and mental health should be factored into it. How do you want to feel most mornings when you wake up? How do you want to feel most evenings when you are ready to sleep?
For more details about planning for a mentally healthy retirement, check out the Workplace Strategies for Mental Health. It’s an online resource available to all Canadians at no cost courtesy of Canada Life. On it you can find a Retiring Well Questionnaire to help guide you through the non-financial aspects of retirement.
Slide 29:
The slide presents a "Retirement checklist" with four key actions employees should take as they approach retirement. These actions include notifying their employer, reviewing group and personal savings, updating beneficiary information, and applying for government benefits. The slide features a red background with white text and icons, and includes a crown icon above the title .
Presenter: Lets wrap up today’s session with a checklist you can use to make sure you’re retirement-ready.
The first thing on the checklist is to notify your employer that you’re retiring, ideally up to a year in advance.
Next is to review your beneficiaries on all plans, policies and wills. And don't forget about your investments. Are there adjustments to be made?
Finally, if you’re approaching retirement and you haven't done so already, apply for government benefits so the process can get started well before you expect to receive your first payments.
Slide 30:
The slide provides information on tools, resources, and support available from Canada Life. It includes contact details for Canada Life's tech and customer service lines, a member website URL, and resources for retirement education such as articles, calculators, videos, and links to external resources. The slide also features a logo and a background image of a person using a tablet.
Presenter: When it comes to retiring there’s a lot of information to review and decisions to make. Fortunately, there’s plenty of support available to you as a Canada Life group savings plan member.
For help, call our main support line at 1-800-724-3402.
To create a retirement goal, research and/or change your investment options, access your statements and more, sign in to mycanadalifeatwork.com.
And, if you want to keep learning more about key steps and important considerations as you are getting close to retirement, visit canadalife.com/smartpath where you’ll find articles, videos and calculators to support you in your retirement readiness journey.
Slide 31:
The slide provides contact information for questions, featuring a phone number (1-800-724-3402) and a website (mycanadalifeatwork.com). It includes a disclaimer about the general nature of the information and trademarks by The Canada Life Assurance Company. The slide has a teal background with a white text box on the left containing the word "Questions?" and a speech bubble icon on the bottom left.
Presenter: Thank you for joining us today! I hope you have some take aways and considerations as you countdown to your retirement.
Whether you’re just starting to save or want to make sure you’re on track, this webinar will help you better understand saving for retirement
Learn more about:
- The different sources of retirement income
- How much to save
- Ways your group savings plan can help you save more, faster
Description:
This webinar is presented in ASL by a middle-aged man. He is standing in front of a grey screen with slides to his left. This webinar is provided by Canada Life and many of the slides have the Canada Life logo on them.
Slide 1: Retirement – Saving for your future
Cover slide introducing the presentation on retirement planning and savings. The cover photo shows an older couple fishing.
Presenter:
Hi and welcome to the retirement – saving for your future webinar.
Slide 2: Canadians and our retirement savings
Highlights key statistics: 47% of Canadian workers worry about running out of money in retirement. Only 35% of Canadians aged 50+ can afford to retire when they want. Rising housing costs are delaying retirement savings.
Presenter:
If you’re one of the many Canadians worried about saving for retirement, you’re not alone. [click] 47% of Canadian workers worry about running out of money in retirement. [click] Only 35% of working Canadians aged 50+ can afford to retire when they want to. [click] And Canadians with rent and mortgage payments are delaying retirement savings altogether. The good news for each of you is that you have a workplace savings plan that can help alleviate some of these concerns.
Slide 3: Agenda Outlines the presentation topics:
• Where can my retirement income come from?• How much do I need to save? • How can my group retirement and savings plan help me save? The slide also includes a photo of an elderly woman smiling, positioned to the left of the agenda.
Presenter:
Our goal in today’s webinar is to share information about your potential retirement income sources, how you can evaluate your retirement saving strategy, and the potential next steps you can take to be confident saving for the retirement lifestyle that is right for you.
Slide 4: Sources of retirement income
Breaks down income into public and private sources: Public: OAS and CPP/QPP Private: Workplace savings plans and personal savings Visual description: A two-column layout showing public vs. private income sources.
Presenter: When planning for retirement, it’s important to understand the different potential sources of retirement income. This includes both public and private sources. Public, or government plans, include Old Age Security and the Canada Pension Plan or if you live in Quebec, the Québec Pension Plan. Retirement income from private plans include workplace savings plans and your own personal savings. Let’s take a closer look at each of these sources to ensure you understand how they will work for you during your retirement years.
Slide 5: CPP and QPP overview
Explains: CPP/QPP can start between ages 60–70 (72 for QPP). Benefits are taxable. Based on age, contributions, and average earnings. Maximum monthly payment: $1,364.60; average: $815 (as of July 2024).
Presenter:
CPP is a contributory public pension plan that provides a basic level of earnings in retirement for workers throughout Canada – except for Quebec. Workers in Quebec are covered by QPP, which provides similar benefits. These are taxable benefits and are adjusted annually. The amount you’ll receive from these benefits depends on your average earnings throughout your working life, including how much you’ve contributed while working, and the age you decide to start receiving your CPP or QPP benefit. For this year, the maximum monthly benefit amount you could receive, as a new recipient starting at age 65, is $1,364. It’s important that you keep in mind, not everyone will be eligible for this maximum amount. Your individual situation will determine how much you'll receive. You can get your estimate of your monthly CPP payments by logging into your My Service Canada Account. Or go to My Account with Retraite Quebec to get an estimate for QPP payments.
Slide 6: CPP and QPP contribution rates
Outlines contribution tiers: 0% on first $3,500 5.95% on $3,500.01–$68,500 4% on $68,500.01–$73,200 0% above $73,200
Presenter:
Originally, CPP and QPP were designed to replace 25% of the average working wage. Eventually this amount will be increased to 33% of the average working wage. Similar to how there are tax brackets for income taxes, there are now contribution thresholds: The first $3,500 of your yearly earnings continues to be exempt from CPP and QPP contributions. The next $3,500 to $68,000 of your earnings has a contribution rate of 5.95%. The new second level of contributions was introduced on January 1, 2024. For earnings you make between $68,500 and $73,200 the contribution rate is 4%. Earnings over $73,200 are exempt from contributions. Your employer matches the CPP or QPP and CPP2 or QPP2 contributions you make. The remaining changes to CPP and QPP will be phased-in in 2025 with the CPP2 and QPP2 amounts increasing to14% above the amount of the first earnings ceiling. The thresholds are updated annually.
Slide 7: When will CPP/QPP start?
Shows impact of starting early or late: 0.6% monthly reduction before 65 (up to -36%) 0.7% monthly increase after 65 (up to +42%) Example: Jean receives $815 at 65, $521.60 at 60, $1,157.30 at 70 Presenter: The age you start receiving CPP or QPP effects how much you’ll get. You can start receiving benefits when you’re 60 and defer them until you’re 70. If you apply to take your CPP/QPP before you’re 65, your benefit amount will be reduced by 0.60% for every month you take it early. If you wait to start taking benefits until after you’re 65, the amount you’ll get will increase by 0.70% for every month you delay. There’s no one answer that would be applicable to everyone regarding when you should start receiving these benefits. It will all depend on your individual plans and circumstances that includes your health and other retirment income resources. Let’s review an example.
[CLICK] Jean is eligible to receive the average CPP amount at age 65, which is $815.00 [CLICK] If Jean applies to take the benefit at age 60 the monthly amount payable is reduced by 36% to $485.32. [CLICK] If Jean waits until age 70, the amount increases by 42% to $1,076.81 per month
Slide 8: OAS overview
Explains: Starts between ages 65–70 Taxable Based on residency and income Maximum monthly payment: $727.67 (Oct–Dec 2024)
Presenter:
Next, let’s review Old Age Security, or OAS. OAS is a benefit available at age 65. The amount you receive is based on the number of years you’ve lived in Canada after the age of 18. So, if you’ve been a resident for 40 years, you’ll receive the maximum. If it's less than 40 years you may get a partial benefit. You must be a resident for at least 10 years to receive any OAS. It’s also important to note that OAS is income tested and the OAS recovery tax, more commonly known as the Clawback, may be implemented. In 2024, if your net world income exceeds $90,997 you may be eligible for less OAS next year. Once your net world income exceed $148,065, you will may not be eligible to receive any OAS in the following year. The minimum and maximum amounts are adjusted each year. When you reach 75, your OAS payments will automatically be increased by 10%. OAS is a taxable benefit, and the amount payable is reviewed and potentially adjusted by the government four times a year to keep up with the current cost of living.
Slide 9: When does OAS start?
Cannot start before 65 Increases 0.6% monthly after 65 (up to +36%) Example: Jean receives $727.67 at 65, $989.63 at 70 Presenter: Similar to CPP and QPP, one of the factors that can affect how much OAS benefits you get is when you take it. The earliest you can start receiving OAS payments is 65. You can delay taking it until you’re 70. If you decide to delay taking the payments the benefit amount increases by 0.6% for each month you delay taking it after you turn 65. Let’s take another look at Jean.
[CLICK]
Jean has lived in Canada for their entire life and is eligible to receive the maximum OAS amount at age 65, which is $727.67 [CLICK] A quick reminder that if Jean wanted to receive OAS at age 60 that isn’t an option. [CLICK] If Jean waits until age 70 Jean’s amount is increased by 36% and is $989.63 per month.
Slide 10: Types of private retirement savings plans
Lists workplace and individual plans: RRSP, TFSA, NRSP RPP, DPSP Presenter: Government benefits likely won’t be enough to cover all your expenses in retirement. Your private savings will help supplement them. Let’s take a closer look at private saving plans. Private saving plans include both your personal savings, for example with a bank or other financial institution, and workplace plans that are sponsored by your employer or union. Some plan types are available in workplace plans and individually. They include RRSPs which are designed for retirement, TFSAs which are for savings of any type and non-registered saving plans, which is just a fancy way of saying savings that don’t have any special tax treatment. RPPs and DPSPs are two plan types that are only available through workplace plans. While all these savings plan types are possible to have in a workplace plan, I want to emphasize that it’s unlikely all of them will be available to you. Speak to your plan administrator to find out which options are.
Slide 11: How much do I need to save for retirement?
Three steps: Create a retirement budget Estimate government benefits Combine all sources Presenter: Whether you intend on saving through your group retirement and savings plan, personal savings, or both, you’ll still need to determine how much to save. You can do this in three steps: Step 1 - Create a retirement budget. Before we can know how much we need to save, we need to know what we are saving for. Step 2 - Obtain your government benefits estimates. Step 3 - Put it all together to figure out how much you need to save. Let’s review each of these steps in more detail. I’ll use an example to help illustrate the steps.
Slide 12: Meet Bert
Profile: 39 years old, lives in Winnipeg $60,000 in RRSP $65,000 salary at ABC Company Eligible for 3% employer match Presenter: Meet Bert. Bert is a 39-year-old homeowner from Winnipeg, Manitoba. He has $60,000 of savings already set aside for his retirement in an RRSP at his bank. Bert was just hired by ABC Company and is fortunate to have a retirement savings plan to participate in. His yearly salary is $65,000 and the retirement savings plan offers him employer matching. For this example, Bert can contribute 3% of his earnings to the plan and ABC Company will match his contribution. Bert also noticed that his workplace plan provides him the option to increase his personal savings by making voluntary contributions. As we go through this example keep in mind that it’s for illustration purposes only. Your group plan rules, including availability of employer contribution matching, may not be the same as Bert’s.
Slide 13: Step 1: Estimate monthly expenses in retirement
Breakdown: Fixed: $950 (e.g., utilities, insurance) Discretionary: $1,050 (e.g., food, travel) Total: $2,000
Presenter:
The first step is to create an estimated retirement budget. A budget is a working document meaning it’s something that you may want to revisit and update from time to time. Start with itemizing your approximate expenses that you foresee in retirement. For Bert, retirement is still quite a few years away. We created Bert’s retirement budget using his current monthly expenses of $2,500 and then adjusted it to reflect that some of his expenses will reduce or be eliminated by retirement. For example, he anticipates having his mortgage paid off by then, so we didn’t include rent or mortgage payments in his fixed expenses. Bert’s total approximate monthly retirement expenses will be $2,000.
Slide 14: Step 2: Obtain your government benefits estimates (CPP) Instructions to access CPP estimates via My Service Canada Account. The slide illustrates this using a screenshot of two Government of Canada webpages.
Presenter:
The next step is to obtain estimates how much money will be received from government benefits. As Bert lives in Manitoba, he participates in the CPP. Your estimated CPP benefits can be found on Canada.ca by signing into your My Service Canada Account.
Slide 15: Step 2: Obtain your government benefits estimates (QPP)
Instructions to access QPP estimates via Retraite Québec website. This slide is explained using two screenshots from the Retraite Québec website. The first shows the Online Services page, highlighting where to navigate to access QPP estimates. The second illustrates how to request statements of participation from that page.
Presenter:
If you live in Quebec, you’ll participate in QPP. You can find your QPP benefits on the Retraite Quebec website singing into your account.
Slide 16: Step 2: Determine your benefits (OAS) If an individual has lived in Canada for 40 years by the time they retire, they are likely to receive the maximum Old Age Security (OAS) benefit. Otherwise, they can use the Old Age Security Benefits Estimator on Canada.ca to estimate their payment. Includes a screenshot of the Old Age Security Benefits Estimator page on the Government of Canada website. Presenter: Bert also needs to obtain the estimate the amount of OAS benefit he’ll receive. This can also be done on Canada.ca where you’ll find the the Old Age Security Benefits Estimator.
Slide 17: Step 3: Put it all together Slide provides an example how to combine them: Income: $1,544 (CPP + OAS) Expenses: $2,000 Shortfall: $456/month The slide also features a picture of a cat positioned to the right, next to the expenses section.
Presenter:
Once you’ve estimated your retirement expenses and the amount of government benefits, you’ll receive, step three is putting it all together. Here’s what it would look like for Bert. For expected income from Government benefits, Bert’s expected amount from CPP is around the average amount payable. Bert is also expecting the full OAS pension, so the total estimated monthly income from the government at age 65 will be $1,544. Bert’s estimated expenses in retirement are expected to be about $2,000 a month. As you can see Bert’s expenses are going to exceed his income from government benefits by $456 a month. This is the amount of income he’ll need from his private savings to retire comfortably. The final step in putting it all together is to figure out how much more Bert needs to save today to cover the extra $456 a month he’ll need in retirement.
Slide 18: Step 3: Put it all together Instructions to use the retirement goal tool on My Canada Life at Work. The slide also features a screenshot of the My Canada Life at Work overview page.
Presenter:
To figure out how much Bert needs to save, we’re going to use the Retirement Goal tool on mycanadalifeatwork.com. You can access it from the overview screen once you sign in. Let’s quickly go through the various steps of the calculator so that you know what to expect when you complete the tool.
Slide 19: Step 1: Information gathering Provides an example of Bert gathering: Plan details Existing savings Government benefit estimates The slide includes a screenshot of the Retirement Goal Tool, specifically the Step 1: Ready page.
Presenter:
Step 1 The first step reminds you of all the information you need to gather to get the most out of this tool. It includes: - Your approximate expenses today and in retirement - Information about your workplace savings plan - Details about any existing retirement savings you may have at other financial institutions - Government benefits estimates
Slide 20: Step 2: When would you like to retire? User inputs desired retirement age into the tool. The slide includes a screenshot of the Retirement Goal Tool, specifically the Step 2: "When would you like to retire?”
Presenter:
Step 2 is an easy one! What age would you like to retire. Bert would like to retire at age 65
Slide 21: Step 3: What are your current monthly expenses? Shows a screenshot of a user entering monthly expenses into the tool.
Presenter:
Next, you’ll be prompted to enter your approximate monthly expenses. Bert’s expenses are about $2,500 a month.
Slide 22: Step 4: Will you need more or less money in retirement? Shows a screenshot of a user estimating if retirement expenses will be higher or lower than current.
Presenter:
The fourth step asks you to input your expected expenses at retirement. You don’t need to guess at how much things will cost in the future. Input your expenses in today’s dollars and the tool will make adjustments to account for inflation. Bert’s expected future expenses are $2,000 a month. Slide 23: Step 5: Registered savings Shows a screenshot of a user inputting current RRSP or other registered savings.
Presenter:
Step 5 asks you to enter how much saving you have outside of your group plan. Bert has $60,000 in an RRSP at a bank and enters that amount.
Presenter: When you complete this tool for yourself, combine all your savings into one entry even if your savings are held at different institutions.
Slide 24: Step 6: How much are you contributing to registered plans?
The slide tells that Bert contributes 3% and receives 3% match. He enters 6% total. The slide also features a screenshot of Step 6 of the tool, which is titled "Contributions."
Presenter:
Step 6 in the tool is to input the amount of contributions you make to your workplace plan. As a reminder, Bert can contribute 3% of his income and receive another 3% contribution from his employer. For that reason, we’ll enter the full 6% total into this calculation. [CLICK] And we’ll enter Bert’s yearly salary of $65,000 below it.
Slide 25: Step 7: Do you have any other savings?
Bert has no non-registered savings. The slide also features a screenshot of Step 7 of the tool, which is titled "non-registered savings."
Presenter:
Step 7 asks for the amount of non-registered savings you have, for example in a saving account or other assets you have, like the sale of a property, that will fund your retirement. Bert doesn’t have any non-registered savings, so we’ll enter $0 for him.
Slide 26: Step 8: What’s your expected income from CPP/QPP? Bert selects average CPP benefit. The slide also features a screenshot of Step 8 of the tool, which is titled "CPP/QPP."
Presenter:
Steps 8 and 9 are for Government retirement benefits. The Tool does provide easy drop-down options to enter maximum amount, average amount or a custom amount.
We selected the average amount of CPP for Bert.
Slide 27: Step 9: What’s your expected income from OAS?
Bert selects maximum OAS benefit. The slide also features a screenshot of Step 9 of the tool, which is titled "What’s your expected income from OAS."
Presenter:
We also know that Bert is expecting the maximum OAS so we selected that from the drop-down menu.
Slide 28: Step 10: Will you have other income? Bert has no other income sources. The slide also features a screenshot of Step 10 of the tool, which is titled "Other income."
Presenter:
Bert is almost done! The last question is around any other expected income in retirement. This includes things such as rent from income properties, part-time jobs, and any other source that hasn’t already been factored in. Bert doesn’t have any other income sources, so we left this one as $0 for him as well.
Slide 29: Step 11: Results Tool shows Bert has a $74/month shortfall. He can close the gap by contributing 1% more. The slide also features a screenshot of the last step in the tool which showcases the results using a bar graph.
Presenter:
The last step is to review your results. If you have a shortfall the tool will let you know how much more you need to contribute to meet your income goal. As you can see, even with his contribution into his group savings plan, Bert will still have a shortfall of about $74 per month in retirement. The tool provides Bert with feedback that he needs to contribute 7% of his salary in order to meet his goal. Since Bert is already saving 6% his income, he only needs to contribute an extra 1% to meet his income goals. He decides to do this by setting up voluntary contributions into his group plan equal to 1% of his salary.
Slide 30: What to do with your results Suggestions: Review budget and expenses Maximize group plan Delay retirement or work part-time
Presenter:
Now, let’s talk about you instead of Bert. If go through these steps and the tool indicates you’re on track, be sure to review and update the tool periodically. As your life changes your goals may too and we want your retirement savings to keep up with them. If you’re not on track, this is your opportunity to implement changes today to achieve your future goals: - Need to save more? Review your current budget to find ways to save - Spend time reviewing your expected retirement expenses. Planning and budgeting is important today and in the future. - Know the rules of your group retirement savings plan. If your plan offers employer matching, be sure to take advantage of it and get the most that you’re eligible for. - You may want to consider part-time work − both today and in your early retirement years. - You may also want to consider delaying your retirement. Use the retirement goal tool to understand the impact of pushing back your retirement age.
Slide 31: Use a budget worksheet for current and future expenses Promotes Canada Life’s online budget calculator at canadalife.com/cashcalculator and features a screenshot of a sample page in the cash flow calculator.
Presenter:
Speaking of budgeting, using a budget worksheet can make creating a budget much easier. You can find a free one at canadalife.com/cashcalculator.
Slide 32: How can my group retirement and savings plan help me save? Benefits: Employer matching Payroll deductions Lower investment fees The slide also showcases a picture of a father sitting on a lawn chair, high fiving his toddler son while holding his baby in his other arm.
Presenter:
Your group retirement and savings plan has a few features that can make saving easier. Your plan may provide employer contributions, allow you to save with payroll deductions and offer investment management fees that are typically lower than you’d pay for similar individual investments. Let’s explore these in more detail.
Slide 33: Payroll deductions cost less than you think
Shows how 3% and 6% contributions reduce take-home pay by only $53 and $105 bi-weekly, respectively. Visual description: Two tables comparing gross pay, contributions, taxes, and net pay for 0%, 3%, and 6% contributions. Presenter: Not only are payroll deductions an easy and convenient way to save for your retirement, but they also cost less than you think because of when tax is calculated. This basic example will highlight the impact of saving through payroll deduction to a registered plan, such as an RRSP or Pension Plan. In the first example it assumes a gross annual income of $65,000 and no contributions are being made to a retirement savings plan. Gross pay is $2,500 and there is NO payroll contribution being made so tax will be calculated on the full amount. This is a generic example so we will assume tax at 30% with take home pay being $1,750 [CLICK] [CLICK] By making a 3% payroll deducted contribution, [CLICK] that equals $75 which is deducted from gross pay and sent over to Canada Life to be invested.
[CLICK] This reduces taxable income, and as a result, [CLICK] less tax is paid up front. [CLICK] In this example, by making a $75 contribution, [CLICK] take home pay is only different by $53 dollars. [CLICK] [CLICK] Now let’s increase savings to 6% and see the impact on take home pay. [CLICK] The payroll deduction will now be $150, [CLICK] reducing taxable pay to $2,350. [CLICK] Tax payable will also reduce to $705 *CLICK* resulting in a take home pay of $1,645. The difference to take home pay prior to contributing to the plan, [CLICK] versus contributing $150 is only $105.
Slide 34: What are investment management fees and operating expenses (IMFOE’s)?
Explains: Fees cover professional services Expressed as a percentage Deducted daily, reducing returns The slide also features a picture of a lady using her phone.
Presenter:
The next way that your group retirement and savings plan can help you save is through your investment management fees and operating expenses (IMFOE’s). IMFs are fees paid to investment managers for their professional services, including the daily management of each fund offered through your group plan. The operating expenses associated with the Fees are a fund’s costs, such as administration and audit fees. IMFOEs are the combined amount expressed as an annualized % which is deducted out of the fund to pay for these costs. When you’re part of a group plan, you have group buying power so your fees are typically less than what you would pay to invest in a mutual fund or segregated fund at the bank as an individual. Here’s a quick example how a difference of even 1% the fees you are paying can make a big difference in your long-term savings.
Slide 35: The impact of lower fees Shows how group plans grow more over time. Visual description: Bar graph comparing 25-year growth of $25,000: Group plan: $84,659 Individual plan: $66,646 Difference: $18,013
Presenter:
In this example, there’s [CLICK] $25,000 in a group retirement plan and $25,000 an individual plan. We are also comparing a difference of 1% in the IMFOE’s. [CLICK] [CLICK] While a 1% savings doesn’t seem like much, over 25 years it makes a big difference. 1% in savings, means you have a 1% greater rate of return year over year for 25 years. [CLICK] IMFOE’s vary by plan. For more information about the fees you’re paying for the different investment options, log into your member portal at mycanadalifeatwork.com. All of your investment options and applicable fees are listed there.
Slide 36: Tools, resources and support
Lists: Member website: mycanadalifeatwork.com Education: articles, videos, calculators Contact: 1-800-724-3402 and tech line 1-888-222-0775
Presenter:
When it comes to saving for retirement there’s a lot of information to review and decisions to make. Fortunately, there’s plenty of support available to you as a Canada Life group savings plan member. For help, call our main support line at 1-800-724-3402. To create a retirement goal, research and/or change your investment options, access your statements and more, sign in to mycanadalifeatwork.com. And, you want to keep learning more about money and investing, visit canadalife.com/smartpath where you’ll find articles, videos and calculators to support you in your financial literacy journey.
Slide 37: Questions?
Encourages contacting Canada Life for help. Reiterates that the information is educational and not a guarantee of future outcomes.
Presenter:
While saving for retirement can be daunting, you’ve already taken a big step in your journey by watching this webinar. We encourage you to watch more of them to keep learning about money and your group saving plan.
Description:
This webinar is presented in ASL by a middle-aged man. He is standing in front of a grey screen with slides to his left. This webinar is provided by Canada Life and many of the slides have the Canada Life logo on them.
Slide 1: Retirement – Saving for your future
Cover slide introducing the presentation on retirement planning and savings. The cover photo shows an older couple fishing.
Presenter:
Hi and welcome to the retirement – saving for your future webinar.
Slide 2: Canadians and our retirement savings
Highlights key statistics: 47% of Canadian workers worry about running out of money in retirement. Only 35% of Canadians aged 50+ can afford to retire when they want. Rising housing costs are delaying retirement savings.
Presenter:
If you’re one of the many Canadians worried about saving for retirement, you’re not alone. [click] 47% of Canadian workers worry about running out of money in retirement. [click] Only 35% of working Canadians aged 50+ can afford to retire when they want to. [click] And Canadians with rent and mortgage payments are delaying retirement savings altogether. The good news for each of you is that you have a workplace savings plan that can help alleviate some of these concerns.
Slide 3: Agenda Outlines the presentation topics:
• Where can my retirement income come from?• How much do I need to save? • How can my group retirement and savings plan help me save? The slide also includes a photo of an elderly woman smiling, positioned to the left of the agenda.
Presenter:
Our goal in today’s webinar is to share information about your potential retirement income sources, how you can evaluate your retirement saving strategy, and the potential next steps you can take to be confident saving for the retirement lifestyle that is right for you.
Slide 4: Sources of retirement income
Breaks down income into public and private sources: Public: OAS and CPP/QPP Private: Workplace savings plans and personal savings Visual description: A two-column layout showing public vs. private income sources.
Presenter: When planning for retirement, it’s important to understand the different potential sources of retirement income. This includes both public and private sources. Public, or government plans, include Old Age Security and the Canada Pension Plan or if you live in Quebec, the Québec Pension Plan. Retirement income from private plans include workplace savings plans and your own personal savings. Let’s take a closer look at each of these sources to ensure you understand how they will work for you during your retirement years.
Slide 5: CPP and QPP overview
Explains: CPP/QPP can start between ages 60–70 (72 for QPP). Benefits are taxable. Based on age, contributions, and average earnings. Maximum monthly payment: $1,364.60; average: $815 (as of July 2024).
Presenter:
CPP is a contributory public pension plan that provides a basic level of earnings in retirement for workers throughout Canada – except for Quebec. Workers in Quebec are covered by QPP, which provides similar benefits. These are taxable benefits and are adjusted annually. The amount you’ll receive from these benefits depends on your average earnings throughout your working life, including how much you’ve contributed while working, and the age you decide to start receiving your CPP or QPP benefit. For this year, the maximum monthly benefit amount you could receive, as a new recipient starting at age 65, is $1,364. It’s important that you keep in mind, not everyone will be eligible for this maximum amount. Your individual situation will determine how much you'll receive. You can get your estimate of your monthly CPP payments by logging into your My Service Canada Account. Or go to My Account with Retraite Quebec to get an estimate for QPP payments.
Slide 6: CPP and QPP contribution rates
Outlines contribution tiers: 0% on first $3,500 5.95% on $3,500.01–$68,500 4% on $68,500.01–$73,200 0% above $73,200
Presenter:
Originally, CPP and QPP were designed to replace 25% of the average working wage. Eventually this amount will be increased to 33% of the average working wage. Similar to how there are tax brackets for income taxes, there are now contribution thresholds: The first $3,500 of your yearly earnings continues to be exempt from CPP and QPP contributions. The next $3,500 to $68,000 of your earnings has a contribution rate of 5.95%. The new second level of contributions was introduced on January 1, 2024. For earnings you make between $68,500 and $73,200 the contribution rate is 4%. Earnings over $73,200 are exempt from contributions. Your employer matches the CPP or QPP and CPP2 or QPP2 contributions you make. The remaining changes to CPP and QPP will be phased-in in 2025 with the CPP2 and QPP2 amounts increasing to14% above the amount of the first earnings ceiling. The thresholds are updated annually.
Slide 7: When will CPP/QPP start?
Shows impact of starting early or late: 0.6% monthly reduction before 65 (up to -36%) 0.7% monthly increase after 65 (up to +42%) Example: Jean receives $815 at 65, $521.60 at 60, $1,157.30 at 70 Presenter: The age you start receiving CPP or QPP effects how much you’ll get. You can start receiving benefits when you’re 60 and defer them until you’re 70. If you apply to take your CPP/QPP before you’re 65, your benefit amount will be reduced by 0.60% for every month you take it early. If you wait to start taking benefits until after you’re 65, the amount you’ll get will increase by 0.70% for every month you delay. There’s no one answer that would be applicable to everyone regarding when you should start receiving these benefits. It will all depend on your individual plans and circumstances that includes your health and other retirment income resources. Let’s review an example.
[CLICK] Jean is eligible to receive the average CPP amount at age 65, which is $815.00 [CLICK] If Jean applies to take the benefit at age 60 the monthly amount payable is reduced by 36% to $485.32. [CLICK] If Jean waits until age 70, the amount increases by 42% to $1,076.81 per month
Slide 8: OAS overview
Explains: Starts between ages 65–70 Taxable Based on residency and income Maximum monthly payment: $727.67 (Oct–Dec 2024)
Presenter:
Next, let’s review Old Age Security, or OAS. OAS is a benefit available at age 65. The amount you receive is based on the number of years you’ve lived in Canada after the age of 18. So, if you’ve been a resident for 40 years, you’ll receive the maximum. If it's less than 40 years you may get a partial benefit. You must be a resident for at least 10 years to receive any OAS. It’s also important to note that OAS is income tested and the OAS recovery tax, more commonly known as the Clawback, may be implemented. In 2024, if your net world income exceeds $90,997 you may be eligible for less OAS next year. Once your net world income exceed $148,065, you will may not be eligible to receive any OAS in the following year. The minimum and maximum amounts are adjusted each year. When you reach 75, your OAS payments will automatically be increased by 10%. OAS is a taxable benefit, and the amount payable is reviewed and potentially adjusted by the government four times a year to keep up with the current cost of living.
Slide 9: When does OAS start?
Cannot start before 65 Increases 0.6% monthly after 65 (up to +36%) Example: Jean receives $727.67 at 65, $989.63 at 70 Presenter: Similar to CPP and QPP, one of the factors that can affect how much OAS benefits you get is when you take it. The earliest you can start receiving OAS payments is 65. You can delay taking it until you’re 70. If you decide to delay taking the payments the benefit amount increases by 0.6% for each month you delay taking it after you turn 65. Let’s take another look at Jean.
[CLICK]
Jean has lived in Canada for their entire life and is eligible to receive the maximum OAS amount at age 65, which is $727.67 [CLICK] A quick reminder that if Jean wanted to receive OAS at age 60 that isn’t an option. [CLICK] If Jean waits until age 70 Jean’s amount is increased by 36% and is $989.63 per month.
Slide 10: Types of private retirement savings plans
Lists workplace and individual plans: RRSP, TFSA, NRSP RPP, DPSP Presenter: Government benefits likely won’t be enough to cover all your expenses in retirement. Your private savings will help supplement them. Let’s take a closer look at private saving plans. Private saving plans include both your personal savings, for example with a bank or other financial institution, and workplace plans that are sponsored by your employer or union. Some plan types are available in workplace plans and individually. They include RRSPs which are designed for retirement, TFSAs which are for savings of any type and non-registered saving plans, which is just a fancy way of saying savings that don’t have any special tax treatment. RPPs and DPSPs are two plan types that are only available through workplace plans. While all these savings plan types are possible to have in a workplace plan, I want to emphasize that it’s unlikely all of them will be available to you. Speak to your plan administrator to find out which options are.
Slide 11: How much do I need to save for retirement?
Three steps: Create a retirement budget Estimate government benefits Combine all sources Presenter: Whether you intend on saving through your group retirement and savings plan, personal savings, or both, you’ll still need to determine how much to save. You can do this in three steps: Step 1 - Create a retirement budget. Before we can know how much we need to save, we need to know what we are saving for. Step 2 - Obtain your government benefits estimates. Step 3 - Put it all together to figure out how much you need to save. Let’s review each of these steps in more detail. I’ll use an example to help illustrate the steps.
Slide 12: Meet Bert
Profile: 39 years old, lives in Winnipeg $60,000 in RRSP $65,000 salary at ABC Company Eligible for 3% employer match Presenter: Meet Bert. Bert is a 39-year-old homeowner from Winnipeg, Manitoba. He has $60,000 of savings already set aside for his retirement in an RRSP at his bank. Bert was just hired by ABC Company and is fortunate to have a retirement savings plan to participate in. His yearly salary is $65,000 and the retirement savings plan offers him employer matching. For this example, Bert can contribute 3% of his earnings to the plan and ABC Company will match his contribution. Bert also noticed that his workplace plan provides him the option to increase his personal savings by making voluntary contributions. As we go through this example keep in mind that it’s for illustration purposes only. Your group plan rules, including availability of employer contribution matching, may not be the same as Bert’s.
Slide 13: Step 1: Estimate monthly expenses in retirement
Breakdown: Fixed: $950 (e.g., utilities, insurance) Discretionary: $1,050 (e.g., food, travel) Total: $2,000
Presenter:
The first step is to create an estimated retirement budget. A budget is a working document meaning it’s something that you may want to revisit and update from time to time. Start with itemizing your approximate expenses that you foresee in retirement. For Bert, retirement is still quite a few years away. We created Bert’s retirement budget using his current monthly expenses of $2,500 and then adjusted it to reflect that some of his expenses will reduce or be eliminated by retirement. For example, he anticipates having his mortgage paid off by then, so we didn’t include rent or mortgage payments in his fixed expenses. Bert’s total approximate monthly retirement expenses will be $2,000.
Slide 14: Step 2: Obtain your government benefits estimates (CPP) Instructions to access CPP estimates via My Service Canada Account. The slide illustrates this using a screenshot of two Government of Canada webpages.
Presenter:
The next step is to obtain estimates how much money will be received from government benefits. As Bert lives in Manitoba, he participates in the CPP. Your estimated CPP benefits can be found on Canada.ca by signing into your My Service Canada Account.
Slide 15: Step 2: Obtain your government benefits estimates (QPP)
Instructions to access QPP estimates via Retraite Québec website. This slide is explained using two screenshots from the Retraite Québec website. The first shows the Online Services page, highlighting where to navigate to access QPP estimates. The second illustrates how to request statements of participation from that page.
Presenter:
If you live in Quebec, you’ll participate in QPP. You can find your QPP benefits on the Retraite Quebec website singing into your account.
Slide 16: Step 2: Determine your benefits (OAS) If an individual has lived in Canada for 40 years by the time they retire, they are likely to receive the maximum Old Age Security (OAS) benefit. Otherwise, they can use the Old Age Security Benefits Estimator on Canada.ca to estimate their payment. Includes a screenshot of the Old Age Security Benefits Estimator page on the Government of Canada website. Presenter: Bert also needs to obtain the estimate the amount of OAS benefit he’ll receive. This can also be done on Canada.ca where you’ll find the the Old Age Security Benefits Estimator.
Slide 17: Step 3: Put it all together Slide provides an example how to combine them: Income: $1,544 (CPP + OAS) Expenses: $2,000 Shortfall: $456/month The slide also features a picture of a cat positioned to the right, next to the expenses section.
Presenter:
Once you’ve estimated your retirement expenses and the amount of government benefits, you’ll receive, step three is putting it all together. Here’s what it would look like for Bert. For expected income from Government benefits, Bert’s expected amount from CPP is around the average amount payable. Bert is also expecting the full OAS pension, so the total estimated monthly income from the government at age 65 will be $1,544. Bert’s estimated expenses in retirement are expected to be about $2,000 a month. As you can see Bert’s expenses are going to exceed his income from government benefits by $456 a month. This is the amount of income he’ll need from his private savings to retire comfortably. The final step in putting it all together is to figure out how much more Bert needs to save today to cover the extra $456 a month he’ll need in retirement.
Slide 18: Step 3: Put it all together Instructions to use the retirement goal tool on My Canada Life at Work. The slide also features a screenshot of the My Canada Life at Work overview page.
Presenter:
To figure out how much Bert needs to save, we’re going to use the Retirement Goal tool on mycanadalifeatwork.com. You can access it from the overview screen once you sign in. Let’s quickly go through the various steps of the calculator so that you know what to expect when you complete the tool.
Slide 19: Step 1: Information gathering Provides an example of Bert gathering: Plan details Existing savings Government benefit estimates The slide includes a screenshot of the Retirement Goal Tool, specifically the Step 1: Ready page.
Presenter:
Step 1 The first step reminds you of all the information you need to gather to get the most out of this tool. It includes: - Your approximate expenses today and in retirement - Information about your workplace savings plan - Details about any existing retirement savings you may have at other financial institutions - Government benefits estimates
Slide 20: Step 2: When would you like to retire? User inputs desired retirement age into the tool. The slide includes a screenshot of the Retirement Goal Tool, specifically the Step 2: "When would you like to retire?”
Presenter:
Step 2 is an easy one! What age would you like to retire. Bert would like to retire at age 65
Slide 21: Step 3: What are your current monthly expenses? Shows a screenshot of a user entering monthly expenses into the tool.
Presenter:
Next, you’ll be prompted to enter your approximate monthly expenses. Bert’s expenses are about $2,500 a month.
Slide 22: Step 4: Will you need more or less money in retirement? Shows a screenshot of a user estimating if retirement expenses will be higher or lower than current.
Presenter:
The fourth step asks you to input your expected expenses at retirement. You don’t need to guess at how much things will cost in the future. Input your expenses in today’s dollars and the tool will make adjustments to account for inflation. Bert’s expected future expenses are $2,000 a month. Slide 23: Step 5: Registered savings Shows a screenshot of a user inputting current RRSP or other registered savings.
Presenter:
Step 5 asks you to enter how much saving you have outside of your group plan. Bert has $60,000 in an RRSP at a bank and enters that amount.
Presenter: When you complete this tool for yourself, combine all your savings into one entry even if your savings are held at different institutions.
Slide 24: Step 6: How much are you contributing to registered plans?
The slide tells that Bert contributes 3% and receives 3% match. He enters 6% total. The slide also features a screenshot of Step 6 of the tool, which is titled "Contributions."
Presenter:
Step 6 in the tool is to input the amount of contributions you make to your workplace plan. As a reminder, Bert can contribute 3% of his income and receive another 3% contribution from his employer. For that reason, we’ll enter the full 6% total into this calculation. [CLICK] And we’ll enter Bert’s yearly salary of $65,000 below it.
Slide 25: Step 7: Do you have any other savings?
Bert has no non-registered savings. The slide also features a screenshot of Step 7 of the tool, which is titled "non-registered savings."
Presenter:
Step 7 asks for the amount of non-registered savings you have, for example in a saving account or other assets you have, like the sale of a property, that will fund your retirement. Bert doesn’t have any non-registered savings, so we’ll enter $0 for him.
Slide 26: Step 8: What’s your expected income from CPP/QPP? Bert selects average CPP benefit. The slide also features a screenshot of Step 8 of the tool, which is titled "CPP/QPP."
Presenter:
Steps 8 and 9 are for Government retirement benefits. The Tool does provide easy drop-down options to enter maximum amount, average amount or a custom amount.
We selected the average amount of CPP for Bert.
Slide 27: Step 9: What’s your expected income from OAS?
Bert selects maximum OAS benefit. The slide also features a screenshot of Step 9 of the tool, which is titled "What’s your expected income from OAS."
Presenter:
We also know that Bert is expecting the maximum OAS so we selected that from the drop-down menu.
Slide 28: Step 10: Will you have other income? Bert has no other income sources. The slide also features a screenshot of Step 10 of the tool, which is titled "Other income."
Presenter:
Bert is almost done! The last question is around any other expected income in retirement. This includes things such as rent from income properties, part-time jobs, and any other source that hasn’t already been factored in. Bert doesn’t have any other income sources, so we left this one as $0 for him as well.
Slide 29: Step 11: Results Tool shows Bert has a $74/month shortfall. He can close the gap by contributing 1% more. The slide also features a screenshot of the last step in the tool which showcases the results using a bar graph.
Presenter:
The last step is to review your results. If you have a shortfall the tool will let you know how much more you need to contribute to meet your income goal. As you can see, even with his contribution into his group savings plan, Bert will still have a shortfall of about $74 per month in retirement. The tool provides Bert with feedback that he needs to contribute 7% of his salary in order to meet his goal. Since Bert is already saving 6% his income, he only needs to contribute an extra 1% to meet his income goals. He decides to do this by setting up voluntary contributions into his group plan equal to 1% of his salary.
Slide 30: What to do with your results Suggestions: Review budget and expenses Maximize group plan Delay retirement or work part-time
Presenter:
Now, let’s talk about you instead of Bert. If go through these steps and the tool indicates you’re on track, be sure to review and update the tool periodically. As your life changes your goals may too and we want your retirement savings to keep up with them. If you’re not on track, this is your opportunity to implement changes today to achieve your future goals: - Need to save more? Review your current budget to find ways to save - Spend time reviewing your expected retirement expenses. Planning and budgeting is important today and in the future. - Know the rules of your group retirement savings plan. If your plan offers employer matching, be sure to take advantage of it and get the most that you’re eligible for. - You may want to consider part-time work − both today and in your early retirement years. - You may also want to consider delaying your retirement. Use the retirement goal tool to understand the impact of pushing back your retirement age.
Slide 31: Use a budget worksheet for current and future expenses Promotes Canada Life’s online budget calculator at canadalife.com/cashcalculator and features a screenshot of a sample page in the cash flow calculator.
Presenter:
Speaking of budgeting, using a budget worksheet can make creating a budget much easier. You can find a free one at canadalife.com/cashcalculator.
Slide 32: How can my group retirement and savings plan help me save? Benefits: Employer matching Payroll deductions Lower investment fees The slide also showcases a picture of a father sitting on a lawn chair, high fiving his toddler son while holding his baby in his other arm.
Presenter:
Your group retirement and savings plan has a few features that can make saving easier. Your plan may provide employer contributions, allow you to save with payroll deductions and offer investment management fees that are typically lower than you’d pay for similar individual investments. Let’s explore these in more detail.
Slide 33: Payroll deductions cost less than you think
Shows how 3% and 6% contributions reduce take-home pay by only $53 and $105 bi-weekly, respectively. Visual description: Two tables comparing gross pay, contributions, taxes, and net pay for 0%, 3%, and 6% contributions. Presenter: Not only are payroll deductions an easy and convenient way to save for your retirement, but they also cost less than you think because of when tax is calculated. This basic example will highlight the impact of saving through payroll deduction to a registered plan, such as an RRSP or Pension Plan. In the first example it assumes a gross annual income of $65,000 and no contributions are being made to a retirement savings plan. Gross pay is $2,500 and there is NO payroll contribution being made so tax will be calculated on the full amount. This is a generic example so we will assume tax at 30% with take home pay being $1,750 [CLICK] [CLICK] By making a 3% payroll deducted contribution, [CLICK] that equals $75 which is deducted from gross pay and sent over to Canada Life to be invested.
[CLICK] This reduces taxable income, and as a result, [CLICK] less tax is paid up front. [CLICK] In this example, by making a $75 contribution, [CLICK] take home pay is only different by $53 dollars. [CLICK] [CLICK] Now let’s increase savings to 6% and see the impact on take home pay. [CLICK] The payroll deduction will now be $150, [CLICK] reducing taxable pay to $2,350. [CLICK] Tax payable will also reduce to $705 *CLICK* resulting in a take home pay of $1,645. The difference to take home pay prior to contributing to the plan, [CLICK] versus contributing $150 is only $105.
Slide 34: What are investment management fees and operating expenses (IMFOE’s)?
Explains: Fees cover professional services Expressed as a percentage Deducted daily, reducing returns The slide also features a picture of a lady using her phone.
Presenter:
The next way that your group retirement and savings plan can help you save is through your investment management fees and operating expenses (IMFOE’s). IMFs are fees paid to investment managers for their professional services, including the daily management of each fund offered through your group plan. The operating expenses associated with the Fees are a fund’s costs, such as administration and audit fees. IMFOEs are the combined amount expressed as an annualized % which is deducted out of the fund to pay for these costs. When you’re part of a group plan, you have group buying power so your fees are typically less than what you would pay to invest in a mutual fund or segregated fund at the bank as an individual. Here’s a quick example how a difference of even 1% the fees you are paying can make a big difference in your long-term savings.
Slide 35: The impact of lower fees Shows how group plans grow more over time. Visual description: Bar graph comparing 25-year growth of $25,000: Group plan: $84,659 Individual plan: $66,646 Difference: $18,013
Presenter:
In this example, there’s [CLICK] $25,000 in a group retirement plan and $25,000 an individual plan. We are also comparing a difference of 1% in the IMFOE’s. [CLICK] [CLICK] While a 1% savings doesn’t seem like much, over 25 years it makes a big difference. 1% in savings, means you have a 1% greater rate of return year over year for 25 years. [CLICK] IMFOE’s vary by plan. For more information about the fees you’re paying for the different investment options, log into your member portal at mycanadalifeatwork.com. All of your investment options and applicable fees are listed there.
Slide 36: Tools, resources and support
Lists: Member website: mycanadalifeatwork.com Education: articles, videos, calculators Contact: 1-800-724-3402 and tech line 1-888-222-0775
Presenter:
When it comes to saving for retirement there’s a lot of information to review and decisions to make. Fortunately, there’s plenty of support available to you as a Canada Life group savings plan member. For help, call our main support line at 1-800-724-3402. To create a retirement goal, research and/or change your investment options, access your statements and more, sign in to mycanadalifeatwork.com. And, you want to keep learning more about money and investing, visit canadalife.com/smartpath where you’ll find articles, videos and calculators to support you in your financial literacy journey.
Slide 37: Questions?
Encourages contacting Canada Life for help. Reiterates that the information is educational and not a guarantee of future outcomes.
Presenter:
While saving for retirement can be daunting, you’ve already taken a big step in your journey by watching this webinar. We encourage you to watch more of them to keep learning about money and your group saving plan.
Are you new to Canada? This webinar will help you learn more about the financial aspects of retiring in Canada including:
- Government retirement benefits you may be eligible for
- How registered savings plans can help you to pay less tax
- Answers to common questions
Descriptive:
This webinar is presented in ASL by a middle-aged man. He is standing in front of a grey screen with slides to his left. This webinar is provided by Canada Life and many of the slides have the Canada Life logo on them.
Slide 1: Welcome to Canada
The cover slide introduces the presentation, which focuses on the Canadian retirement system.
Presenter:
Hi there, this is the Welcome to Canada - The Canadian retirement system webinar. Have you recently moved to Canada? Or have you lived here for a while and want to learn more about how saving for retirement works in Canada? Either way, welcome - you've come to the right place.
Slide 2: Immigration in Canada
Highlights that 471,771 new permanent immigrants arrived in Canada in 2023. Immigrants with permanent residence make up 20% of the total population.
Presenter:
Canada has one of the highest immigration rates in the world. In fact, almost 20% of our population are immigrants with permanent residence. In 2023 alone, 471, 771 new permanent residents came to Canada from about 212 different countries. Just think of all the differences between these countries when it comes to saving for retirement. That’s what makes this presentation so important.
Slide 3: Agenda
Outlines the topics covered:
Integrity and security of Canada’s financial system
Sources of retirement income
Government benefits
Registered savings accounts
Group savings plan advantages
Presenter:
Our goal for today’s session is to give you a basic understanding of how saving for retirement works in Canada. It may be very similar to your country of origin, or it could be quite different. We’ll cover where your retirement income may come from including what the government provides and what you’ll need to save for yourself. We’ll finish the presentation with a review of how your group savings plan can help you prepare for retirement.
Slide 4: What makes Canada’s financial system “safe”
Explains that Canada’s financial system is highly regulated by:
The Office of the Superintendent of Financial Institutions (OSFI)
The Financial Consumer Agency of Canada (FCAC)
Presenter:
Once we start discussing saving for retirement in Canada, you may notice that Canadians put a lot of trust into both the government and financial institutions, like banks and insurance companies, to manage their savings. It’s because Canada’s financial system is one of the most reputable in the world.
Here’s why:
Highly regulated
The Office of the Superintendant of Financial Institutions (OFSI), is an independent agency of the Government of Canada. Their mandate is to regulate and supervise more than 400 financial institutions and 1200 pension federally regulated plans.
The Financial Consumer Agency of Canada (FCAC) is responsible for protecting the rights and interests of consumers, such as yourselves, of financial products and services.
Slide 5: What makes Canada’s financial system “safe”
Describes the stability of Canadian banks:
Known for strength and prudent practices
Over 99% of working-age Canadians have a bank account
National banking system with widespread access
Presenter:
Canadian banks are ranked among the world’s most stable
Canadian banks are recognized for their strength and resiliency, prudent lending practices, large and diverse deposit bases and diligent government oversight.
Over 99% of working age Canadians have an account at a financial institution. This is much higher than the global average of 76%4.
Canada has a national system of banking where many retail banks have a vast network of branches across the country. This national system means that consumers have access to similar products at the same price regardless of where they live.
Slide 6: What makes Canada’s financial system “safe”
Explains deposit insurance:
CDIC and Assuris protect deposits and insurance policies
CDIC has resolved 43 failures with no loss to depositors
Presenter:
Financial institutions are insured
Canada Deposit Insurance Corporation (CDIC) and Assuris were both established to protect Canadians in the event these financial institutions fail.
Canadian’s deposits and insurance policies held at each institution are covered up to a certain amount.
CDIC has resolved 43 member failures (or financial institution failures) to date affecting 2 million Canadians. No one has ever lost any money from a CDIC-insured financial institution closure.
Slide 7: What makes Canada’s financial system “safe”
Describes professional management of retirement funds:
CPP Investments and CDPQ manage pension funds
Operate independently from government
Presenter:
Government benefits funds are professionally managed
Canada Pension Plan Investment Board (CPP Investments) manages the money Canadians contribute to the Canada Pension Plan (CPP). Their goal is to provide Canadians with financial security and stability in retirement.
Similar to CPP Investments, Caisse de dépôt et placement du Québec (CDPQ) manages the Quebec Pension Plan (QPP) funds.
These organizations are independent of government and operate at arm’s length from federal and provincial governments.
Slide 8: Sources of retirement income
Lists out three potential sources of retirement income
Personal savings
Employer sponsored plans (savings plan)
Government benefits
Presenter:
To retire comfortably in Canada, you’ll need to figure out how to replace your employment income to cover your expenses when you’re no longer working.
There are three potential sources of retirement income that can all work together to provide for you in retirement. They include your personal savings, savings through employer sponsor plans, like the Canada Life group savings plan you’re a part of and government retirement benefits.
Slide 9: Government retirement benefits
Slide to start the next section of the presentation. Has a photo of a retirement couple.
Presenter:
One of the income sources I mentioned was government retirement benefits. It’s money that you may be eligible to receive from the government each month once you retire. The amount you receive will depend on several factors including the number of years you worked in Canada, how much you earned and the number of years you lived in Canada.
Slide 10: Government retirement benefits - Overview
Lists the main government retirement benefits:
Canada Pension Plan (CPP)
Québec Pension Plan (QPP)
Old Age Security (OAS)
Guaranteed Income Supplement (GIS)
Presenter:
There are three types of government benefits that you may receive when you retire.
The Canada Pension Plan (CPP) or if you live in the province of Quebec, the Quebec Pension Plan (QPP)
Old Age Security (OAS)
And the Guaranteed Income Supplement (GIS)
Let’s take a closer look at each of them, starting with CPP and QPP
Slide 11: CPP and QPP
Explains how CPP and QPP provide financial support for retirement, disability, or death. The amount depends on age, contributions, and average earnings. Benefits can start between ages 60 and 70 (up to 72 for QPP).
Presenter:
CPP and QPP will provide you with financial assistance in your retirement. You may also be eligible for benefits in the event of your disability or death, however, for today's presentation we are going to focus on the retirement benefit.
The amount you receive is based on:
the age you decide to start your pension
how much and for how long you contributed to the CPP/QPP
your average earnings throughout your working life
CPP and QPP amounts are reviewed each year and may be adjusted to account for inflation.
Slide 12: You’re contributing to CPP or QPP with each pay
Shows a sample pay stub illustrating deductions for CPP, EI, RRSP, and taxes.
Presenter:
If you’re new to Canada, there is a lot to learn about the financial system and one thing you and your family may be doing is trying to account for the various deductions that you see coming off of your pay stub.
One of those deductions is for CPP, or QPP. In Canada, every working person over the age of 18 who earns more than a minimum amount ($3,500 per year) must contribute to one of these programs.
If you want to know how much you’re contributing, you can review your paystub to find out how much is deducted from your pay.
Slide 13: OAS and GIS
Describes OAS and GIS:
OAS is based on residency in Canada after age 18
GIS is for low-income OAS recipients
Both have income limits
Presenter:
Next, let’s take a look at OAS and GIS.
Unlike CPP/QPP you will not see deductions coming off of your pay for the other Government benefits. Old Age Security is funded out of general tax revenues.
Also unlike the CPP/QPP, this benefit isn’t based on how much you’ve contributed. Instead, it’s based on how long you’ve lived in Canada after the age of 18.
The Guaranteed Income Supplement (GIS) is a secondary benefit available to OAS recipients who have a low income.
While OAS and GIS aren’t based on what you earned during your career in Canada, there are some income limits.
For example, in 2025 you wouldn’t qualify for OAS if you earned more than $148,451 in 2024.
And for GIS your income must be low. For example, in 2024, a single individual would have needed an income under $22,056 to quality.
These amounts are reviewed and may be adjusted 4 times per year, so always check with the Government of Canada to understand your own personal situation.
Slide 14: Snapshot of 2024 government benefits at age 65
Provides benefit monthly amounts:
CPP/QPP max: $1,433; average: $808
OAS max: $728
Total annual max: $2,161; average: $1,536
Amounts vary and are adjusted regularly.
Presenter:
So, how much could you receive from government benefits when you retire? As we have reviewed, the benefits payable will be based on many factors, so here we are showing you both the maximum monthly amounts payable as well as the averages.
For CPP and QPP if you were 65 years old today, the maximum monthly benefit you could receive is $1, 433 per month. Most people don’t receive the maximum benefit, so we have also included the average amount payable. At the end of 2024, the average amount payable was $808 per month.
For OAS, the maximum monthly amount payable is $727 at the start of 2025. We do not have data around the average amount payable.
When we combine the two government benefits, the maximum monthly amount payable is $2,162 per month. When doing your retirement planning, it’s important to obtain your own personal benefit estimates….
Slide 15: CPP and OAS
Encourages visiting government websites to estimate your future CPP, QPP, and OAS benefits.
Presenter:
You can obtain your CPP/QPP and OAS estimates today to assist you with your retirement planning.
For CPP and OAS, visit the Government of Canada website at Canada.ca, and for those who are eligible for QPP, visit the Government of Quebec website at retraitequebec.gouv.qc.ca
Slide 16: Retiring outside of Canada
Explains that Canada has agreements with other countries to recognize pension contributions. CPP, QPP, and OAS can be paid in local currency abroad.
Presenter:
Canada is diverse - and it is quite possible - that you may have lived and/or worked outside of Canada and eligible for pensions and benefits from either Canada and/or another country because of a social security agreement.
A social security agreement is an international agreement that is held between Canada and another country that coordinates the pension programs between both countries.
A social security agreement can help you qualify for benefits by allowing you to combine your periods of contribution or periods of residency in Canada with your periods of contribution or periods of residency in the other country to meet the minimum eligibility criteria.
It can also reduce or eliminate restrictions based on citizenship or on payment of pensions abroad.
It is recommended for those who this may apply to understand the details relating to you as it varies from agreements established between countries. Obtain advice from an international tax professional who is familiar with the rules in both countries.
Visit canada.ca for full details on the government retirement benefits and seek tax advice to assist you with your particular situation.
CPP
Eligibility - Pensions and Benefits - Canada.ca
QPP
https://www.rrq.gouv.qc.ca/en/programmes/regime_rentes/ententes_internationales/Pages/ententes_internationales.aspx
Slide 17: Registered savings accounts
Introduces registered savings accounts as tools for retirement and other financial goals.
Presenter:
The two other retirement income sources I mentioned were personal savings and employer sponsors plans. Both of those sources can include savings in registered accounts.
Slide 18: Individual and group registered accounts
Explains that registered accounts can be personal or employer-sponsored. Group accounts are only available through employers.
Presenter:
We have reviewed how Government Benefits can assist with some of your income in retirement, now let’s discuss personal savings and employer sponsored registered accounts.
Registered accounts can be part of your personal savings, your employer-sponsored plan, or both.
Personal savings can include individual registered savings accounts. You can open them at a financial institution of your choice.
Employer sponsored plans can include group registered savings accounts. They are only available through your employer.
Plan rules are established by your employer, following the rules set out in applicable laws and legislation.
Slide 19: Registered savings accounts for different financial goals
Lists types of accounts:
RESP for education
FHSA for first home
TFSA for general savings
RRSP, DPSP, RPP for retirement
Presenter:
There are different types of registered savings accounts to help you save for various financial goals. Depending on where you have moved from, you may feel that the taxes we pay in Canada are higher than what you are used to. Registered accounts offered by the Government of Canada gives tax-incentives and sometimes grants.
If you are saving for your first home, you can use the First home savings account to help you save and buy
If your goals are around saving for a child’s education, the Registered Education Savings Plan (RESP) is available
A tax-free savings account is good for any savings goal you may have, both short and long term
And if you are saving for retirement, the registered accounts available are Registered Retirement Savings Plans (RRSPs), Deferred Profit Sharing Plans (DPSPs) and Registered pension plans (RPPs).
All these plans are designed to assist Canadians with achieving various financial goals, however the focus of our session today is around retirement, and we’ll focus on RRSPs. If you are interested in learning more about TFSAs, RESPs and FHSAs you can find information at canadalife.com or through the Government of Canada website.
Slide 20: Registered savings accounts for retirement income
Details:
RRSPs can be individual or group
DPSPs and RPPs are group-only
All offer tax-sheltered growth
Presenter:
There are different types of registered savings accounts for retirement income. RRSPs are the most common as you can open an individual RRSP at your financial institution, or sometimes it’s available as a group plan through your place of employment.
There are other types of registered savings accounts that you may have access to at your place of employment which could include Deferred Profit Sharing Plans and Registered Pension Plans. You may or may not have access to these at work. If you are unsure what types of retirement savings accounts you have access to at your place of employment, you will want to check in with your employer for the details.
There are some differences between RRSPs, DPSPs and RPPs, however the one feature that is the same is tax-deferred deposits and the tax-sheltered investment growth which they can offer. In this next section we are going to spend time discussing RRSPs in more detail.
Slide 21: RRSP overview
Describes RRSPs:
Registered with CRA
Require prior Canadian income and tax filing
Intended for long-term retirement savings
Presenter:
What is an RRSP?
A savings account that’s registered with the Canada Revenue Agency (CRA) and gives you tax benefits for saving for retirement.
To open an RRSP, prior income in Canada is required and you have filed your income taxes for the previous year.
For long-term, retirement savings.
Slide 22: RRSPs have tax advantages
Explains:
Contributions reduce taxable income
Investment growth is tax-sheltered
Taxes are paid upon withdrawal, usually in retirement
Presenter:
There are many tax advantages for saving for your retirement in an RRSP.
The main up-front advantage is that you don’t have to pay tax on the money you contribute to an RRSP in the year you make the contribution. You receive a tax deduction, and your money can grow tax-deferred to retirement.
This leads us to the future advantages this can provide. Growth on your investments is also not taxable as it is earned, which means more money stays invested to benefit from compound growth over the long-term. When you start withdrawing your money from your savings, that is the time that you will start paying tax on the amounts with withdraw in any year. However, in retirement you may be making less money and paying less tax at that time.
Let’s review these tax-advantages in more detail…
Slide 23: RRSP up-front tax advantages example
Shows how a $5,000 RRSP contribution reduces taxable income and saves $1,250 in taxes on a $60,000 salary.
Presenter:
The first example we will review is how the tax savings we can receive helps us keep more money in our pockets today.
For example, let's say you earn $60,000 in taxable income and contribute $5,000 to your RRSP. That $5,000 contribution reduces your taxable income to $55,000. Assuming a 25% tax rate, contributing $5,000 to your RRSP could reduce your annual tax bill by $1,250
Slide 24: RRSP future tax advantages example
Bar graph that illustrates that tax-deferred investments grow more over time. A $5,000 investment grows to $21,459 in a registered account vs. $15,027 in a non-registered one.
Presenter:
Here’s an example of the long-term tax benefits an RRSP can provide. When your investments can grow without paying taxes on your investment growth, you end up saving a lot more over the long-term. It’s because when taxes aren’t deducted from your earnings, there’s more money that can stay invested and benefit from compound growth.
In this example we’re assuming your marginal tax rate is 25% and you earn 6% a year on your investments. As shown, if you invest $5,000 in a non-registered account, you’ll end up with just over $15,000 after 25 years. Now, if instead your investments are held in a registered tax-deferred account, like an RRSP, you’ll end up with almost $21,500 after 25 years. That’s $6,432 more.
Now remember, even though your money was able to grow tax-free, you’ll still need to pay income tax on the amounts you withdraw when you’re ready to start taking it out for retirement.
Slide 25: Investment options
Explains that RRSPs can hold various investments, depending on what’s offered by the financial institution where they’re held.
Presenter:
While an RRSP is a type of registered account, it’s not an investment of itself. RRSPs can potentially hold the same types of investments as other investment accounts you may have. The investments available to you will depend on what the options are at the financial institution your RRSP is held.
Slide 26: Contribution rules
You can contribute to an RRSP until December 31 of the year you turn 71, up to your CRA deduction limit.
Presenter:
As an RRSP is a tax advantaged savings plan, there are limits as to how much we can contribute to RRSPs each year. To receive the tax deduction, you must meet the contribution rules:
Be 71 years of age or younger.
Contribute up to the amount indicated in your deduction limit. Your deduction limit is established by many factors, including income you’ve received in your previous working years in Canada, contributions to other registered plans, and previous contributions you have made to an RRSP.
In Canada, each individual is responsible for contributing within their deduction limit and ensuring they stay within it…
Slide 27: Where can I find my RRSP deduction limit?
Lists sources:
Notice of Assessment
CRA MyAccount
Tax Information Phone Service
Presenter:
To find out what your deduction limit is you will need to have filed at least one tax return in Canada. Once you have submitted your annual tax return, the government will provide you with a Notice of Assessment. Included in your Notice of assessment is your RRSP deduction limit for that year.
You can also log into your MyAccount at canada.ca, access your account through the mobile app, or call CRA’s automated service at 1-800-267-6999.
Slide 28: Registered Retirement Income Fund (RRIF) Annuity
Introduces LIF and RRIFs annuities as ways to convert savings into retirement income.
Explains that different account types (RRSP, DPSP, RPP) convert into income streams. Taxes are paid when funds are withdrawn.
Presenter:
You may be wondering, what happens when you’re done saving and you’re ready to retire and start withdrawing money to live off of.
The first step is to understand what kind of registered account you have, this will provide the rules around how to receive payments in your retirement.
Be aware of what type of account you have
When you are ready to use your savings for retirement income, these registered accounts will need to be converted to another account or product type to allow for regular payments.
No matter what your savings are converted to, when you withdraw the money, you will pay income tax on the payments you receive. If you recall, you received the tax savings during your working years, this will be the first time this money will be taxed.
Depending on what your account has been converted to, there are different withdrawal rules and features that may affect your retirement income.
If you’re interested in learning more about receiving income in your retirement and how these various plans work, you’ll want to check out our other Canada Life webinars.
Slide 29: Using your group savings plan to save for retirement
Slide to introduce next section of the presentation. Includes a photo of a loving, elderly couple drinking coffee together.
Presenter:
Before we wrap up today’s session, I want to review some of the ways that your group savings plan can help you save for retirement.
Slide 30: Using your group savings plan to save for retirement
Highlights group plan features:
Payroll deductions
Low fees
Multilingual support
Employer contributions
Presenter:
Payroll deductions
When you save through payroll deductions, you’re automatically saving each time you’re paid (you’ll notice one of the deductions on your paystub is contribution into your group savings plan).
You can enjoy immediate tax-savings when your payroll deductions are directed to a registered group plan, like a group registered retirement savings plan (group RRSP ) or registered retirement plan (RPP).
Low fees
The fees you pay on investment funds you buy through your group savings plan are typically lower than what you’d pay for with comparable individual investments.
You’re benefiting from group buying power – like how you pay less when you buy in bulk.
Employer contributions
Some plans have employer contributions as one of their features. This is when your employer contributes to your plan up to a certain amount.
Your group savings plan is the only place you can save where you’ll get “free money” for doing so.
When employer matching is available, if you don’t take advantage of this feature, you’re missing out.
We can also provide you with access to general support in over 240 languages
Slide 31: Ask us your questions, in any language you speak
Support is available in 240 languages. Canada Life can connect you with an interpreter when you call.
Presenter:
When you call Canada Life, Monday – Friday between the hours of 8am and 8PM Eastern, we can have an interpreter join the call at no cost. The interpreter will be able to translate the call with one of our representatives to your language of choice so that you can speak comfortably and have your questions answered clearly.
Slide 32: My Canada Life at Work – Your online portal to your savings
Encourages users to register or sign in at mycanadalifeatwork.com. Tech support is available by phone.
Call the Canada Life Tech Line at 1-888-222-0775.
Presenter:
You can also access your plan online 24 hours a day by signing in to My Canada Life at Work.
If you haven’t signed in before, you’ll need to register using your policy and certificate number. You can find these numbers on the second page of your mailed statements under key information. If you’ve previously received an email inviting you to register, it may also have this information.
For help signing in, call our technical support line at 1-888-222-0775, weekdays from 8 a.m. to 8 p.m. ET.
Slide 33: What can I do on My Canada Life at Work?
Lists features:
View balances
Change investments
Update beneficiaries
Access statements and tax receipts
Set and track retirement goals
Presenter:
What can I do on My Canada Life at Work?
Review and manage your savings plans
Find your total balance
Review or change your investment selection (if applicable, not all members can change their investment selection online)
Update your beneficiaries (if applicable)
Retrieve your statements and tax receipts
Set and track a retirement goal
And more!
Slide 34: Retirement goal tool
Describes a tool to estimate how much you need to save for retirement, including government and personal savings.
Presenter:
One of the most useful features of My Canada Life at Work is the Retirement goal tool.
It’s an easy-to-use calculator that you’ll find on the Overview screen when you sign in.
It can help you figure out how much savings you need to retire
You can include income sources that you’ll have outside of Canada Life, like government benefits and other personal savings in your calculations.
Slide 35: Want help?
Provides contact information for help with your plan and the online portal. Disclaimer at bottom of page reads: The information in this publication is general in nature and is intended for educational purposes only. Furthermore, there can be no assurance that any trends described in this material will continue or that forecasts will occur. Past performance is not necessarily indicative of future performance.
Presenter:
Thank you for watching. I hope we’ve achieved our goal of providing you with an introduction to the Canadian retirement system.
We hope you’ll watch more webinars to keep learning about retirement and your group savings plan.
Descriptive:
This webinar is presented in ASL by a middle-aged man. He is standing in front of a grey screen with slides to his left. This webinar is provided by Canada Life and many of the slides have the Canada Life logo on them.
Slide 1: Welcome to Canada
The cover slide introduces the presentation, which focuses on the Canadian retirement system.
Presenter:
Hi there, this is the Welcome to Canada - The Canadian retirement system webinar. Have you recently moved to Canada? Or have you lived here for a while and want to learn more about how saving for retirement works in Canada? Either way, welcome - you've come to the right place.
Slide 2: Immigration in Canada
Highlights that 471,771 new permanent immigrants arrived in Canada in 2023. Immigrants with permanent residence make up 20% of the total population.
Presenter:
Canada has one of the highest immigration rates in the world. In fact, almost 20% of our population are immigrants with permanent residence. In 2023 alone, 471, 771 new permanent residents came to Canada from about 212 different countries. Just think of all the differences between these countries when it comes to saving for retirement. That’s what makes this presentation so important.
Slide 3: Agenda
Outlines the topics covered:
Integrity and security of Canada’s financial system
Sources of retirement income
Government benefits
Registered savings accounts
Group savings plan advantages
Presenter:
Our goal for today’s session is to give you a basic understanding of how saving for retirement works in Canada. It may be very similar to your country of origin, or it could be quite different. We’ll cover where your retirement income may come from including what the government provides and what you’ll need to save for yourself. We’ll finish the presentation with a review of how your group savings plan can help you prepare for retirement.
Slide 4: What makes Canada’s financial system “safe”
Explains that Canada’s financial system is highly regulated by:
The Office of the Superintendent of Financial Institutions (OSFI)
The Financial Consumer Agency of Canada (FCAC)
Presenter:
Once we start discussing saving for retirement in Canada, you may notice that Canadians put a lot of trust into both the government and financial institutions, like banks and insurance companies, to manage their savings. It’s because Canada’s financial system is one of the most reputable in the world.
Here’s why:
Highly regulated
The Office of the Superintendant of Financial Institutions (OFSI), is an independent agency of the Government of Canada. Their mandate is to regulate and supervise more than 400 financial institutions and 1200 pension federally regulated plans.
The Financial Consumer Agency of Canada (FCAC) is responsible for protecting the rights and interests of consumers, such as yourselves, of financial products and services.
Slide 5: What makes Canada’s financial system “safe”
Describes the stability of Canadian banks:
Known for strength and prudent practices
Over 99% of working-age Canadians have a bank account
National banking system with widespread access
Presenter:
Canadian banks are ranked among the world’s most stable
Canadian banks are recognized for their strength and resiliency, prudent lending practices, large and diverse deposit bases and diligent government oversight.
Over 99% of working age Canadians have an account at a financial institution. This is much higher than the global average of 76%4.
Canada has a national system of banking where many retail banks have a vast network of branches across the country. This national system means that consumers have access to similar products at the same price regardless of where they live.
Slide 6: What makes Canada’s financial system “safe”
Explains deposit insurance:
CDIC and Assuris protect deposits and insurance policies
CDIC has resolved 43 failures with no loss to depositors
Presenter:
Financial institutions are insured
Canada Deposit Insurance Corporation (CDIC) and Assuris were both established to protect Canadians in the event these financial institutions fail.
Canadian’s deposits and insurance policies held at each institution are covered up to a certain amount.
CDIC has resolved 43 member failures (or financial institution failures) to date affecting 2 million Canadians. No one has ever lost any money from a CDIC-insured financial institution closure.
Slide 7: What makes Canada’s financial system “safe”
Describes professional management of retirement funds:
CPP Investments and CDPQ manage pension funds
Operate independently from government
Presenter:
Government benefits funds are professionally managed
Canada Pension Plan Investment Board (CPP Investments) manages the money Canadians contribute to the Canada Pension Plan (CPP). Their goal is to provide Canadians with financial security and stability in retirement.
Similar to CPP Investments, Caisse de dépôt et placement du Québec (CDPQ) manages the Quebec Pension Plan (QPP) funds.
These organizations are independent of government and operate at arm’s length from federal and provincial governments.
Slide 8: Sources of retirement income
Lists out three potential sources of retirement income
Personal savings
Employer sponsored plans (savings plan)
Government benefits
Presenter:
To retire comfortably in Canada, you’ll need to figure out how to replace your employment income to cover your expenses when you’re no longer working.
There are three potential sources of retirement income that can all work together to provide for you in retirement. They include your personal savings, savings through employer sponsor plans, like the Canada Life group savings plan you’re a part of and government retirement benefits.
Slide 9: Government retirement benefits
Slide to start the next section of the presentation. Has a photo of a retirement couple.
Presenter:
One of the income sources I mentioned was government retirement benefits. It’s money that you may be eligible to receive from the government each month once you retire. The amount you receive will depend on several factors including the number of years you worked in Canada, how much you earned and the number of years you lived in Canada.
Slide 10: Government retirement benefits - Overview
Lists the main government retirement benefits:
Canada Pension Plan (CPP)
Québec Pension Plan (QPP)
Old Age Security (OAS)
Guaranteed Income Supplement (GIS)
Presenter:
There are three types of government benefits that you may receive when you retire.
The Canada Pension Plan (CPP) or if you live in the province of Quebec, the Quebec Pension Plan (QPP)
Old Age Security (OAS)
And the Guaranteed Income Supplement (GIS)
Let’s take a closer look at each of them, starting with CPP and QPP
Slide 11: CPP and QPP
Explains how CPP and QPP provide financial support for retirement, disability, or death. The amount depends on age, contributions, and average earnings. Benefits can start between ages 60 and 70 (up to 72 for QPP).
Presenter:
CPP and QPP will provide you with financial assistance in your retirement. You may also be eligible for benefits in the event of your disability or death, however, for today's presentation we are going to focus on the retirement benefit.
The amount you receive is based on:
the age you decide to start your pension
how much and for how long you contributed to the CPP/QPP
your average earnings throughout your working life
CPP and QPP amounts are reviewed each year and may be adjusted to account for inflation.
Slide 12: You’re contributing to CPP or QPP with each pay
Shows a sample pay stub illustrating deductions for CPP, EI, RRSP, and taxes.
Presenter:
If you’re new to Canada, there is a lot to learn about the financial system and one thing you and your family may be doing is trying to account for the various deductions that you see coming off of your pay stub.
One of those deductions is for CPP, or QPP. In Canada, every working person over the age of 18 who earns more than a minimum amount ($3,500 per year) must contribute to one of these programs.
If you want to know how much you’re contributing, you can review your paystub to find out how much is deducted from your pay.
Slide 13: OAS and GIS
Describes OAS and GIS:
OAS is based on residency in Canada after age 18
GIS is for low-income OAS recipients
Both have income limits
Presenter:
Next, let’s take a look at OAS and GIS.
Unlike CPP/QPP you will not see deductions coming off of your pay for the other Government benefits. Old Age Security is funded out of general tax revenues.
Also unlike the CPP/QPP, this benefit isn’t based on how much you’ve contributed. Instead, it’s based on how long you’ve lived in Canada after the age of 18.
The Guaranteed Income Supplement (GIS) is a secondary benefit available to OAS recipients who have a low income.
While OAS and GIS aren’t based on what you earned during your career in Canada, there are some income limits.
For example, in 2025 you wouldn’t qualify for OAS if you earned more than $148,451 in 2024.
And for GIS your income must be low. For example, in 2024, a single individual would have needed an income under $22,056 to quality.
These amounts are reviewed and may be adjusted 4 times per year, so always check with the Government of Canada to understand your own personal situation.
Slide 14: Snapshot of 2024 government benefits at age 65
Provides benefit monthly amounts:
CPP/QPP max: $1,433; average: $808
OAS max: $728
Total annual max: $2,161; average: $1,536
Amounts vary and are adjusted regularly.
Presenter:
So, how much could you receive from government benefits when you retire? As we have reviewed, the benefits payable will be based on many factors, so here we are showing you both the maximum monthly amounts payable as well as the averages.
For CPP and QPP if you were 65 years old today, the maximum monthly benefit you could receive is $1, 433 per month. Most people don’t receive the maximum benefit, so we have also included the average amount payable. At the end of 2024, the average amount payable was $808 per month.
For OAS, the maximum monthly amount payable is $727 at the start of 2025. We do not have data around the average amount payable.
When we combine the two government benefits, the maximum monthly amount payable is $2,162 per month. When doing your retirement planning, it’s important to obtain your own personal benefit estimates….
Slide 15: CPP and OAS
Encourages visiting government websites to estimate your future CPP, QPP, and OAS benefits.
Presenter:
You can obtain your CPP/QPP and OAS estimates today to assist you with your retirement planning.
For CPP and OAS, visit the Government of Canada website at Canada.ca, and for those who are eligible for QPP, visit the Government of Quebec website at retraitequebec.gouv.qc.ca
Slide 16: Retiring outside of Canada
Explains that Canada has agreements with other countries to recognize pension contributions. CPP, QPP, and OAS can be paid in local currency abroad.
Presenter:
Canada is diverse - and it is quite possible - that you may have lived and/or worked outside of Canada and eligible for pensions and benefits from either Canada and/or another country because of a social security agreement.
A social security agreement is an international agreement that is held between Canada and another country that coordinates the pension programs between both countries.
A social security agreement can help you qualify for benefits by allowing you to combine your periods of contribution or periods of residency in Canada with your periods of contribution or periods of residency in the other country to meet the minimum eligibility criteria.
It can also reduce or eliminate restrictions based on citizenship or on payment of pensions abroad.
It is recommended for those who this may apply to understand the details relating to you as it varies from agreements established between countries. Obtain advice from an international tax professional who is familiar with the rules in both countries.
Visit canada.ca for full details on the government retirement benefits and seek tax advice to assist you with your particular situation.
CPP
Eligibility - Pensions and Benefits - Canada.ca
QPP
https://www.rrq.gouv.qc.ca/en/programmes/regime_rentes/ententes_internationales/Pages/ententes_internationales.aspx
Slide 17: Registered savings accounts
Introduces registered savings accounts as tools for retirement and other financial goals.
Presenter:
The two other retirement income sources I mentioned were personal savings and employer sponsors plans. Both of those sources can include savings in registered accounts.
Slide 18: Individual and group registered accounts
Explains that registered accounts can be personal or employer-sponsored. Group accounts are only available through employers.
Presenter:
We have reviewed how Government Benefits can assist with some of your income in retirement, now let’s discuss personal savings and employer sponsored registered accounts.
Registered accounts can be part of your personal savings, your employer-sponsored plan, or both.
Personal savings can include individual registered savings accounts. You can open them at a financial institution of your choice.
Employer sponsored plans can include group registered savings accounts. They are only available through your employer.
Plan rules are established by your employer, following the rules set out in applicable laws and legislation.
Slide 19: Registered savings accounts for different financial goals
Lists types of accounts:
RESP for education
FHSA for first home
TFSA for general savings
RRSP, DPSP, RPP for retirement
Presenter:
There are different types of registered savings accounts to help you save for various financial goals. Depending on where you have moved from, you may feel that the taxes we pay in Canada are higher than what you are used to. Registered accounts offered by the Government of Canada gives tax-incentives and sometimes grants.
If you are saving for your first home, you can use the First home savings account to help you save and buy
If your goals are around saving for a child’s education, the Registered Education Savings Plan (RESP) is available
A tax-free savings account is good for any savings goal you may have, both short and long term
And if you are saving for retirement, the registered accounts available are Registered Retirement Savings Plans (RRSPs), Deferred Profit Sharing Plans (DPSPs) and Registered pension plans (RPPs).
All these plans are designed to assist Canadians with achieving various financial goals, however the focus of our session today is around retirement, and we’ll focus on RRSPs. If you are interested in learning more about TFSAs, RESPs and FHSAs you can find information at canadalife.com or through the Government of Canada website.
Slide 20: Registered savings accounts for retirement income
Details:
RRSPs can be individual or group
DPSPs and RPPs are group-only
All offer tax-sheltered growth
Presenter:
There are different types of registered savings accounts for retirement income. RRSPs are the most common as you can open an individual RRSP at your financial institution, or sometimes it’s available as a group plan through your place of employment.
There are other types of registered savings accounts that you may have access to at your place of employment which could include Deferred Profit Sharing Plans and Registered Pension Plans. You may or may not have access to these at work. If you are unsure what types of retirement savings accounts you have access to at your place of employment, you will want to check in with your employer for the details.
There are some differences between RRSPs, DPSPs and RPPs, however the one feature that is the same is tax-deferred deposits and the tax-sheltered investment growth which they can offer. In this next section we are going to spend time discussing RRSPs in more detail.
Slide 21: RRSP overview
Describes RRSPs:
Registered with CRA
Require prior Canadian income and tax filing
Intended for long-term retirement savings
Presenter:
What is an RRSP?
A savings account that’s registered with the Canada Revenue Agency (CRA) and gives you tax benefits for saving for retirement.
To open an RRSP, prior income in Canada is required and you have filed your income taxes for the previous year.
For long-term, retirement savings.
Slide 22: RRSPs have tax advantages
Explains:
Contributions reduce taxable income
Investment growth is tax-sheltered
Taxes are paid upon withdrawal, usually in retirement
Presenter:
There are many tax advantages for saving for your retirement in an RRSP.
The main up-front advantage is that you don’t have to pay tax on the money you contribute to an RRSP in the year you make the contribution. You receive a tax deduction, and your money can grow tax-deferred to retirement.
This leads us to the future advantages this can provide. Growth on your investments is also not taxable as it is earned, which means more money stays invested to benefit from compound growth over the long-term. When you start withdrawing your money from your savings, that is the time that you will start paying tax on the amounts with withdraw in any year. However, in retirement you may be making less money and paying less tax at that time.
Let’s review these tax-advantages in more detail…
Slide 23: RRSP up-front tax advantages example
Shows how a $5,000 RRSP contribution reduces taxable income and saves $1,250 in taxes on a $60,000 salary.
Presenter:
The first example we will review is how the tax savings we can receive helps us keep more money in our pockets today.
For example, let's say you earn $60,000 in taxable income and contribute $5,000 to your RRSP. That $5,000 contribution reduces your taxable income to $55,000. Assuming a 25% tax rate, contributing $5,000 to your RRSP could reduce your annual tax bill by $1,250
Slide 24: RRSP future tax advantages example
Bar graph that illustrates that tax-deferred investments grow more over time. A $5,000 investment grows to $21,459 in a registered account vs. $15,027 in a non-registered one.
Presenter:
Here’s an example of the long-term tax benefits an RRSP can provide. When your investments can grow without paying taxes on your investment growth, you end up saving a lot more over the long-term. It’s because when taxes aren’t deducted from your earnings, there’s more money that can stay invested and benefit from compound growth.
In this example we’re assuming your marginal tax rate is 25% and you earn 6% a year on your investments. As shown, if you invest $5,000 in a non-registered account, you’ll end up with just over $15,000 after 25 years. Now, if instead your investments are held in a registered tax-deferred account, like an RRSP, you’ll end up with almost $21,500 after 25 years. That’s $6,432 more.
Now remember, even though your money was able to grow tax-free, you’ll still need to pay income tax on the amounts you withdraw when you’re ready to start taking it out for retirement.
Slide 25: Investment options
Explains that RRSPs can hold various investments, depending on what’s offered by the financial institution where they’re held.
Presenter:
While an RRSP is a type of registered account, it’s not an investment of itself. RRSPs can potentially hold the same types of investments as other investment accounts you may have. The investments available to you will depend on what the options are at the financial institution your RRSP is held.
Slide 26: Contribution rules
You can contribute to an RRSP until December 31 of the year you turn 71, up to your CRA deduction limit.
Presenter:
As an RRSP is a tax advantaged savings plan, there are limits as to how much we can contribute to RRSPs each year. To receive the tax deduction, you must meet the contribution rules:
Be 71 years of age or younger.
Contribute up to the amount indicated in your deduction limit. Your deduction limit is established by many factors, including income you’ve received in your previous working years in Canada, contributions to other registered plans, and previous contributions you have made to an RRSP.
In Canada, each individual is responsible for contributing within their deduction limit and ensuring they stay within it…
Slide 27: Where can I find my RRSP deduction limit?
Lists sources:
Notice of Assessment
CRA MyAccount
Tax Information Phone Service
Presenter:
To find out what your deduction limit is you will need to have filed at least one tax return in Canada. Once you have submitted your annual tax return, the government will provide you with a Notice of Assessment. Included in your Notice of assessment is your RRSP deduction limit for that year.
You can also log into your MyAccount at canada.ca, access your account through the mobile app, or call CRA’s automated service at 1-800-267-6999.
Slide 28: Registered Retirement Income Fund (RRIF) Annuity
Introduces LIF and RRIFs annuities as ways to convert savings into retirement income.
Explains that different account types (RRSP, DPSP, RPP) convert into income streams. Taxes are paid when funds are withdrawn.
Presenter:
You may be wondering, what happens when you’re done saving and you’re ready to retire and start withdrawing money to live off of.
The first step is to understand what kind of registered account you have, this will provide the rules around how to receive payments in your retirement.
Be aware of what type of account you have
When you are ready to use your savings for retirement income, these registered accounts will need to be converted to another account or product type to allow for regular payments.
No matter what your savings are converted to, when you withdraw the money, you will pay income tax on the payments you receive. If you recall, you received the tax savings during your working years, this will be the first time this money will be taxed.
Depending on what your account has been converted to, there are different withdrawal rules and features that may affect your retirement income.
If you’re interested in learning more about receiving income in your retirement and how these various plans work, you’ll want to check out our other Canada Life webinars.
Slide 29: Using your group savings plan to save for retirement
Slide to introduce next section of the presentation. Includes a photo of a loving, elderly couple drinking coffee together.
Presenter:
Before we wrap up today’s session, I want to review some of the ways that your group savings plan can help you save for retirement.
Slide 30: Using your group savings plan to save for retirement
Highlights group plan features:
Payroll deductions
Low fees
Multilingual support
Employer contributions
Presenter:
Payroll deductions
When you save through payroll deductions, you’re automatically saving each time you’re paid (you’ll notice one of the deductions on your paystub is contribution into your group savings plan).
You can enjoy immediate tax-savings when your payroll deductions are directed to a registered group plan, like a group registered retirement savings plan (group RRSP ) or registered retirement plan (RPP).
Low fees
The fees you pay on investment funds you buy through your group savings plan are typically lower than what you’d pay for with comparable individual investments.
You’re benefiting from group buying power – like how you pay less when you buy in bulk.
Employer contributions
Some plans have employer contributions as one of their features. This is when your employer contributes to your plan up to a certain amount.
Your group savings plan is the only place you can save where you’ll get “free money” for doing so.
When employer matching is available, if you don’t take advantage of this feature, you’re missing out.
We can also provide you with access to general support in over 240 languages
Slide 31: Ask us your questions, in any language you speak
Support is available in 240 languages. Canada Life can connect you with an interpreter when you call.
Presenter:
When you call Canada Life, Monday – Friday between the hours of 8am and 8PM Eastern, we can have an interpreter join the call at no cost. The interpreter will be able to translate the call with one of our representatives to your language of choice so that you can speak comfortably and have your questions answered clearly.
Slide 32: My Canada Life at Work – Your online portal to your savings
Encourages users to register or sign in at mycanadalifeatwork.com. Tech support is available by phone.
Call the Canada Life Tech Line at 1-888-222-0775.
Presenter:
You can also access your plan online 24 hours a day by signing in to My Canada Life at Work.
If you haven’t signed in before, you’ll need to register using your policy and certificate number. You can find these numbers on the second page of your mailed statements under key information. If you’ve previously received an email inviting you to register, it may also have this information.
For help signing in, call our technical support line at 1-888-222-0775, weekdays from 8 a.m. to 8 p.m. ET.
Slide 33: What can I do on My Canada Life at Work?
Lists features:
View balances
Change investments
Update beneficiaries
Access statements and tax receipts
Set and track retirement goals
Presenter:
What can I do on My Canada Life at Work?
Review and manage your savings plans
Find your total balance
Review or change your investment selection (if applicable, not all members can change their investment selection online)
Update your beneficiaries (if applicable)
Retrieve your statements and tax receipts
Set and track a retirement goal
And more!
Slide 34: Retirement goal tool
Describes a tool to estimate how much you need to save for retirement, including government and personal savings.
Presenter:
One of the most useful features of My Canada Life at Work is the Retirement goal tool.
It’s an easy-to-use calculator that you’ll find on the Overview screen when you sign in.
It can help you figure out how much savings you need to retire
You can include income sources that you’ll have outside of Canada Life, like government benefits and other personal savings in your calculations.
Slide 35: Want help?
Provides contact information for help with your plan and the online portal. Disclaimer at bottom of page reads: The information in this publication is general in nature and is intended for educational purposes only. Furthermore, there can be no assurance that any trends described in this material will continue or that forecasts will occur. Past performance is not necessarily indicative of future performance.
Presenter:
Thank you for watching. I hope we’ve achieved our goal of providing you with an introduction to the Canadian retirement system.
We hope you’ll watch more webinars to keep learning about retirement and your group savings plan.
Whether you’re just starting out with your Canada Life group savings plan, or want a refresher on its features, this webinar will help learn more and unlock its saving potential.
Learn more about:
- How your group savings plan can help you save more, faster
- Other perks included with your plan
- How to monitor and manage your savings on My Canada Life at Work™
Slide 1: Your plan – Welcome to Canada Life
This is the cover slide introducing the presentation. It sets the stage for an overview of the Canada Life group savings plan.
Presenter:
Welcome to the Your Plan – Welcome to Canada Life webinar.
Slide 2: Agenda
Lists the main topics covered:
Features to help you save
Are you enrolled in your plan?
Managing your savings online
Other perks of being a Canada Life plan member
Best practices
Presenter:
We have developed our webinar to provide information that will help members, who have access to a group savings plan, manage their savings with confidence, using the tools and resources that are available with Canada Life.
Features to help you save
Are you enrolled in your plan?
Managing your savings online
Other perks to being a Canada Life plan member
Best practices
Slide 3: But first…
Introduces the concept of a group savings plan. Notes that all plans are different and encourages reviewing your member booklet or asking your employer for a summary.
Presenter:
Before we dive in, we are going to take a few moments to level set, as many of you joining us today have different levels of experiences, knowledge and are in a different stage in their savings journey.
When we are looking at group savings plans, it is helpful to keep in mind they are not a typical savings plan, that you can open at a financial institution of your choice.
A group savings plan is set up by an employer to help their employees secure a financial future and is part of their overall workplace benefits. For employees, it is an easy way to save for retirement or other goals.
The investments available in your group savings plan will either be selected for you or you will be given the option of choosing yourself, from a menu of options that will be specific to your group savings plan.
As some of the features we’re reviewing today may not apply to your group savings plan, an action item for you to take away, could be to review your member booklet.
Your member booklet is a great resource that lists your group savings plan provisions.
Slide 4: Features to help you save
Title slide introducing the section on savings features.
Presenter:
We are now going to move into the features of a group savings plan, that help you save.
Let’s start by discussing the power of payroll deductions and the paying yourself first method…
Slide 5: Payroll deductions – Pay yourself first
Explains that contributions are deducted from your pay before you spend, helping you save automatically. This is referred to as “paying yourself first.”
Presenter:
When it comes to personal finances, one of the most important things you can do is pay yourself first. This means putting aside money for your own savings and investments before paying any other bills or expenses. By doing this, you ensure that you’re always saving and investing for your future, no matter what else is going on in your life.
When you’re enrolled in a group savings plan, like the one you have with Canada Life, you’re automatically saving each time you’re paid through payroll deductions.
You can see these deductions on your paystub, where you’ll notice one of the payroll deductions taken from your cheque are contributions into your group savings plan.
Slide 6: Payroll deductions – Immediate tax savings
Shows a comparison table of take-home pay with and without a 4% RRSP contribution on a $50,000 salary. The table illustrates that contributing reduces taxable income and results in only a small reduction in net pay. Visual description: A table comparing gross pay, payroll contribution, taxable pay, tax, and take-home pay for two scenarios: no contribution and 4% contribution.
Presenter:
Did you know that through payroll deduction, you can enjoy immediate tax-savings when your payroll deductions are directed to a group registered retirement savings plan, a group RRSP, or registered retirement plan, an RPP.
It’s because income tax isn’t deducted from the amount you’re contributing. Instead, it’s only deducted from the amount you take home. This makes saving through payroll deductions more affordable than saving using after-tax dollars.
Let’s review an example.
Let’s say I am earning $50,000 per year and would like to contribute 4% of my pay to my group retirement plan. If I’m paid ever two weeks, that works out to $1,923 each pay. Contributing 4% works out to $77 each pay.
This reduces my taxable pay to $1,846. I pay tax on the lower amount, which means at the end of the day when my pay is deposited to my bank account, it isn’t $77 less but is reduced by only $54. In this example, it cost me $54 to contribute $77 because I don’t pay tax on my contribution.
Remember, this is just an example for illustration purposes, and your plan types and associate plan provisions may vary.
Slide 7: Payroll deductions – Benefit from dollar-cost averaging.
There’s a graphic on this slide to help explain dollar-cost averaging. It shows the fluctuating price per unit of an investment over time. There’s a line though it that indicates the average price of the investment.
Presenter:
Are you one of the many Canadians who are concerned about where stock markets are headed? When it comes to investing your money, your main goal is no doubt to grow and preserve your wealth.
There are some investors that try to take advantage of the markets by trying to anticipate when investment prices will go up or down. This is so they can buy the investments at the lowest price and then sell them at their highest price, to make the most return on their investments. Sounds good right? Well unfortunately, the problem with this strategy is that it is considered a risky strategy, since we can’t predict the future.
Now dollar cost averaging is a different strategy where you invest the same amount of money on a regular basis, regardless of the price of the investment.
With dollar-cost averaging on the other hand, you invest a little money regularly, rather than a larger amount once in a while. By doing this you avoid the risk of only investing your money when the price is high and increase your chance of investing some of it when costs are low. It essentially averages out the cost of your investment.
The graph on our screen is showing an illustration of a unit price for an investment, that fluctuates between $14 and $20 over a period of time By investing $100 each month at differ prices, the investor in this example was able to buy their investment fund units at an average price of $17.25.
Now let’s tie this strategy back to your group savings plan. By making regular, repeated contributions through automatic payroll deductions, you receive the advantages of dollar-cost averaging. You buy the same dollar amount each time so when prices are low, you get more units. When prices are high, you get fewer units. This takes the guesswork out of when to invest and when not to invest.
Slide 8: More benefits of dollar-cost averaging
Lists three more benefits of dollar-cost averaging:
Keeps emotions out of investing decisions
Keeps you in the market
Beneficial for most investors – including ones who are just starting out
Presenter:
Before moving on, we would like to highlight additional benefits of the dollar cost averaging strategy.
It removes emotion from investing – Since you’re investing regularly rather than based on the positive or negative feelings you may experience when the market changes, it’s harder for your emotions to interfere with your decisions.
It keeps you in the market – Instead of trying to buy your investment at its bottom price and sell at its top price (which is called market timing and is extremely challenging to do as we can’t predict the future), dollar-cost averaging keeps your money invested so it’s there when the market rebounds.
Finally, dollar cost average is ideal for new investors – Because it allows you invest small amounts, it’s perfect for investors who are just starting out.
Slide 9: Low fees
Explains that group plans offer lower investment fees due to group buying power. There are no account or transaction fees, and investment management fees are lower than individual plans.
Presenter:
Another features of your group savings plan, that we are highlighting today, are the associated fees you pay on the investment funds you buy through your group savings plan, that will be typically lower than the fees associated when you invest outside of your group saivngs plan individually.
Your group plan provides group buying power. It is comparable to when you pay less when you buy in bulk.
There are no account fees, investment purchase or transfer fees and low investment management fees (known as IMFOEs)*.
Slide 10: Advantages of lower investment management fees
Illustrates how lower fees result in higher returns over time.
Visual description: A bar graph comparing investment growth over 25 years with a 5% return (group plan) vs. 4% return (individual plan). The group plan shows $6,432 more in growth.
Presenter:
Let’s take a closer look at investment management fees and fund operating expenses.
They’re the fees charged by investment managers for their professional services and for the operating expenses of the fund.
Investment management fees and operating expenses are expressed as a percentage that’s deducted from the funds value. That means the smaller the fees, the more of the fund’s returns are left for you.
This graphic illustrates how lower fees can lead to more savings over time.
In this example, my sibling and I have inherited $25,000 each. As not all Canadians have access to group savings plans, my sibling invests their $25,000 at their financial institution down the street from where they live.
My inheritance, was placed in my group savings plan.
For illustration purposes, we are going to assume we have invested the same way and have the same performance. The only difference will be the fees associated with my group savings plan are 1% lower than my sibling fees.
If we take a take a look over 25 years, the money grows in both plans, however in my group savings plan, will have a higher amount.
Another great opportunity for our viewers will be to review the fees associated with your group plan by signing into their profile on the member site, My Canada Life at Work.
Slide 11: Employer contributions
Notes that some plans include employer contributions, often as a matching program. Not contributing means missing out on part of your compensation.
Presenter:
Some group savings plans have employer contributions as one of their features. This is when your employer contributes to your plan up to a certain amount.
When employer matching is available, if you don’t take advantage of this feature, you’re potentially missing out.
As not all plans have this feature, we are not going to spend much more time reviewing this feature except to encourage our viewers to review their member booklets, that we highlighted earlier in our webinar, to review the contribution formula of your group plan, as there may be an opportunity to maximize this benefit.
Slide 12: Give more of your investments the group advantage
Encourages transferring savings from other institutions into your group plan. Instructions are provided for accessing the transfer form and getting help.
Presenter:
Based on the features of the group plan we have reviewed; some our viewers may be wondering if it may be possible to consolidate external savings into a group plan.
It will depend on your group savings plan and once again you can verify by referencing the member booklet.
Slide 13: Are you enrolled in your plan?
Title slide introducing the section on enrollment.
Presenter:
Now that we’ve discussed some of the best features of a group savings plan, let’s cover off how to enroll.
Slide 14: Ways to enrol
Lists three enrollment methods:
Online with guest ID and password
Auto-enrollment by plan administrator
Paper application submitted to administrator
Presenter:
How a member enrolls in their group savings plan, depends on the group savings plan’s design and it’s not the same for everyone.
Enrolment can be done online where your employer will provide you with the details to get started.
Enrolment may be automatic and completed by your employer, or you may be provided an enrolment guide that includes a paper application that will need to be completed.
Slide 15: How to check if you’re enrolled
Suggests checking your paystub, calling Canada Life at 1-800-724-3402, weekdays from 8 a.m. to 8 p.m. ET.
, or asking your plan administrator to confirm enrollment.
Presenter:
If you aren’t sure if you’re enrolled in your plan, there’s a few ways you can check:
Review your paystub to confirm if contributions are being taken off for retirement savings.
Call Canada Life at 1-800-724-3402, weekdays from 8 a.m. to 8 p.m. ET.
Ask your plan administrator.
Slide 16: Managing your plan online
Title slide introducing the section on online account management.
Presenter:
Now that we’ve discussed the features of your plan and how you can get started savings, let’s talk about how you can manage your savings on the member site, My Canada Life at Work, your online portal.
Slide 17: My Canada Life at Work – Your online portal to your savings
Provides the website address: mycanadalifeatwork.com and tech support number: 1-888-222-0775.
Presenter:
Signing in to My Canada Life at Work is the first step to managing your savings throughout your savings journey.
If you haven’t signed in before, today is the day my friends, you’ll need to register using your policy and certificate number. You can find these numbers on the second page of your mailed statements under key information.
If you’ve previously received an email inviting you to register, it may also have this information.
For help signing in, we have technical support line at 1-888-222-0775 that is there to provide support and guidance, weekdays from 8 a.m. to 8 p.m. ET.
Slide 18: What can I do on My Canada Life at Work?
Lists features of the site:
View balances
Change investments
Update beneficiaries
Access statements and tax receipts
Set and track retirement goals
Presenter:
What can I do on My Canada Life at Work? It is more like what can’t you do.
Once you sign in you are able to:
Review and manage your savings plans any day at any time
Find your total balance and personal rate of return
Review or change your investment selection. Let’s pause here for a moment as we would like to talk about how your investment choices can make a big impact on how much you’re ultimately able to save before retirement
A best practice is to go online regularly to review your investment selections to make sure they’re still in line with your goals.
If you aren’t sure how to choose the best investments for you, join us for our upcoming webinars that teach the basics of investing later this year and the tools and support that are available/
Slide 19: Add or change a beneficiary (if applicable)
Step-by-step instructions for updating beneficiaries through the online portal and a screen shot of the website.
Presenter:
When you are signed in, you may want to make sure your beneficiary is up to date, if applicable.
This is an area many members have questions about.
Let’s review how to do it online - it can take less than 5 minutes.
Here’s how to do it online:
Select the person icon at the top right of your screen.
Select Your profile.
Then choose Beneficiaries and dependants and then view.
Select Edit beneficiaries for any group savings plan you would like to make changes to.
Slide 20: Our favourite feature – Retirement goal tool
Describes a tool that helps estimate how much you need to save for retirement, including government and personal savings.
Presenter:
One of the most useful features of My Canada Life at Work is the Retirement goal tool.
It’s an easy-to-use calculator that you’ll find on the Overview screen when you sign in.
It can help you figure out how much savings you need to achieve your desired retirement.
Slide 21: Retirement goal tool - results
Shows the outcome of using the retirement goal tool.
Visual description: Screenshot of summary showing projected savings needs and progress toward retirement goals.
Presenter:
Once completed, you will receive 1 of 2 empowering messages.
‘Congratulations! You are on track to achieving your retirement income goals’.
Or, it may tell you that you are not on track and provide you suggestions to get you on track or back on track.
Slide 22: Update your contribution amount
Gives instructions for increasing contributions based on your retirement goal tool results. You can do this in two ways:
You can do it online by navigating to the contributions part of My Canada Life at Work
Or by contacting your plan administrator directly
Presenter:
Your retirement goal tool results may lead you to wanting to make changes to the amount you’re contributing. This is something that you may be able to do online directly through Canada Life, or you may have to contact your payroll team to make these changes.
Slide 23: Don’t wait to sign-in
States that members who log in to the site have 30% higher average savings balances than those who haven’t. The statistic sourced from Canada Life data as of August 31, 2024.
Presenter:
We encourage members to not delay signing in to My Canada Life at Work.
Digitally engaged employees fare better in their retirement savings.
Members who have logged into My Canada Life at Work have average savings balances that are 30% higher than those who haven’t.
Slide 24: More perks of your plan
Title slide introducing additional benefits of being a plan member.
Presenter:
Now let us focus on the perks of your plan that can help you with your overall wellbeing.
Slide 25: Workplace Strategies for Mental Health
Describes free resources for mental well-being, including topics like conflict management, accommodations, and mental health tips. Includes a screenshot of the landing page and site url: workplacestrategiesformentalhealth.com.
Presenter:
Workplace Strategies for Mental Health is a leading online source of free, practical tools, resources and programs designed to help all Canadian employers and employees improve psychological health and safety in the workplace and beyond.
Here are examples of topics covered:
Managing workplace conflict and bullying
Approaches for workplace accommodations
Tips for improving and managing your mental health
Through workplace strategies for mental health:
You can increase your knowledge and awareness of workplace psychological health and safety
Help respond to mental health issues at work
If you’re a manager, it can be a great resource for strategies and tools to respond to employee issues at work.
Slide 26: Credit Counselling services
Lists two services:
Credit Counselling Society (nomoredebts.org, 1-877-636-8999)
Solve Your Debts (solveyourdebts.com, 1-888-753-2227)
Presenter:
To help improve your financial wellness, we have partnered with the award-wining, not for profit Credit Counselling Society and the Credit Counselling services Atlantic Canada. If you’re not sure how to manage your debt, credit counselling may be able to help.
Your group savings plan gives you access to certified credit counsellors who you can talk with you confidentially. They’ll ask members how they were referred, and members should mention they’re a Canada Life member.
Slide 27: Wills and estate planning
Outlines services available at discounted rates:
Online will creation
Estate planning guidance
Executor support
Presenter:
Estate planning doesn’t have to be costly or time consuming. Your plan includes discounted wills and estate planning services you can access online.
Create a legal will online
Discounted rate of $50+ HST for Canada Life plan members (regular price $249+ HST)
+ $19/year for access to a digital vault and unlimited edits to your will so you can make changes as your personal situation evolves
Includes power of attorney documents
Estate planning
Personalized guidance and support from estate experts
Preferred pricing with a 5% discount for services for Canada Life members
Executor support
Free online executor support for you or your appointed executor ($80 value)
Slide 28: Why does it matter?
States that half of Canadian adults do not have a will.
Explains that dying intestate means your estate is distributed by law, which may not reflect your wishes and could create tax burdens for your loved ones.
Presenter:
Why is estate planning important?
Half of Canadian adults say they don’t have a will and half of seniors aged 65+ have not updated their wills in the last 5 years.
If you die without a will in Canada or a designated beneficiary on your registered accounts (if applicable) , your money, assets and debts are put into an estate. A court-appointed representative closes your financial affairs and distributes your assets according to the rules and regulations of your province. Besides a loss of control over dispersal of assets, there are also potential tax burdens that can be passed on.
Slide 29: Accessing credit counselling and wills and estate planning services online
Instructions for accessing these services through My Canada Life at Work along with a screenshot:
Sign in
Select “Options for you”
Choose “Learn more” for the desired service
Presenter:
To benefit from discounted rates for credit counselling and wills and estate planning services, you’ll need to contact them through the links provided on My Canada Life at Work.
You’ll find the links under the “Options for you” tab when you sign in.
Slide 30: Saving for Life
Describes educational resources:
Monthly webinars. Register at canadalife.com/saving-for-life-webinars.
Biannual newsletters with plan updates
Self-serve tools on My Canada Life at work and canadalife.com/smartpath
Presenter:
Would you like to continue your retirement and savings education journey?
Consider registering for more of our webinars on a variety of different topics that members have been requesting.
Keep an eye on your email inbox for the semi-annual Savings for Live newsletter which will provide you insights about your plan and your savings goals.
If you’re not receiving it, registering on My Canada Life at Work can help ensure we have your email address on file.
Head over to canadalife.com/smartpath to access articles, videos and calculators
Slide 31: Best practices
Includes 5 colourful icons with one tip below each:
Reading your member booklet
Enrolling when eligible
Signing in regularly
Increasing contributions when possible
Using available tools and resources
Presenter:
Let’s finish by reviewing what you can do to make the most of your plan:
Make sure you understand what’s available to you by reading your member booklet.
Enrol in your plan as soon as you’re eligible to join – don’t wait to enjoy its benefits.
Sign into My Canada Life at Work and review your group savings plans regularly.
Increase your contribution amount when you can, if your plan allows you to and
Use the tools and resources available to you to support your overall well-being.
Slide 32: Want Help?
Contact information for Canada Life:
Help with your plan
1-800-724-3402 8 a.m. to 8 p.m. ET Monday-Friday
Help with My Canada Life at Work
Tech Line 1-888-222-0775
Bottom of the slide has the following disclaimer and trademark line: The information in this publication is general in nature and is intended for educational purposes only. Furthermore, there can be no assurance that any trends described in this material will continue or that forecasts will occur. Past performance is not necessarily indicative of future performance.
Presenter:
Our goal was to share with you how your group savings plan can play big role in helping you achieve the financial goals you have set for yourself and your desired retirement lifestyle.
Be sure to watch our other webinars to keep learning about money and about your group savings plan.
Slide 1: Your plan – Welcome to Canada Life
This is the cover slide introducing the presentation. It sets the stage for an overview of the Canada Life group savings plan.
Presenter:
Welcome to the Your Plan – Welcome to Canada Life webinar.
Slide 2: Agenda
Lists the main topics covered:
Features to help you save
Are you enrolled in your plan?
Managing your savings online
Other perks of being a Canada Life plan member
Best practices
Presenter:
We have developed our webinar to provide information that will help members, who have access to a group savings plan, manage their savings with confidence, using the tools and resources that are available with Canada Life.
Features to help you save
Are you enrolled in your plan?
Managing your savings online
Other perks to being a Canada Life plan member
Best practices
Slide 3: But first…
Introduces the concept of a group savings plan. Notes that all plans are different and encourages reviewing your member booklet or asking your employer for a summary.
Presenter:
Before we dive in, we are going to take a few moments to level set, as many of you joining us today have different levels of experiences, knowledge and are in a different stage in their savings journey.
When we are looking at group savings plans, it is helpful to keep in mind they are not a typical savings plan, that you can open at a financial institution of your choice.
A group savings plan is set up by an employer to help their employees secure a financial future and is part of their overall workplace benefits. For employees, it is an easy way to save for retirement or other goals.
The investments available in your group savings plan will either be selected for you or you will be given the option of choosing yourself, from a menu of options that will be specific to your group savings plan.
As some of the features we’re reviewing today may not apply to your group savings plan, an action item for you to take away, could be to review your member booklet.
Your member booklet is a great resource that lists your group savings plan provisions.
Slide 4: Features to help you save
Title slide introducing the section on savings features.
Presenter:
We are now going to move into the features of a group savings plan, that help you save.
Let’s start by discussing the power of payroll deductions and the paying yourself first method…
Slide 5: Payroll deductions – Pay yourself first
Explains that contributions are deducted from your pay before you spend, helping you save automatically. This is referred to as “paying yourself first.”
Presenter:
When it comes to personal finances, one of the most important things you can do is pay yourself first. This means putting aside money for your own savings and investments before paying any other bills or expenses. By doing this, you ensure that you’re always saving and investing for your future, no matter what else is going on in your life.
When you’re enrolled in a group savings plan, like the one you have with Canada Life, you’re automatically saving each time you’re paid through payroll deductions.
You can see these deductions on your paystub, where you’ll notice one of the payroll deductions taken from your cheque are contributions into your group savings plan.
Slide 6: Payroll deductions – Immediate tax savings
Shows a comparison table of take-home pay with and without a 4% RRSP contribution on a $50,000 salary. The table illustrates that contributing reduces taxable income and results in only a small reduction in net pay. Visual description: A table comparing gross pay, payroll contribution, taxable pay, tax, and take-home pay for two scenarios: no contribution and 4% contribution.
Presenter:
Did you know that through payroll deduction, you can enjoy immediate tax-savings when your payroll deductions are directed to a group registered retirement savings plan, a group RRSP, or registered retirement plan, an RPP.
It’s because income tax isn’t deducted from the amount you’re contributing. Instead, it’s only deducted from the amount you take home. This makes saving through payroll deductions more affordable than saving using after-tax dollars.
Let’s review an example.
Let’s say I am earning $50,000 per year and would like to contribute 4% of my pay to my group retirement plan. If I’m paid ever two weeks, that works out to $1,923 each pay. Contributing 4% works out to $77 each pay.
This reduces my taxable pay to $1,846. I pay tax on the lower amount, which means at the end of the day when my pay is deposited to my bank account, it isn’t $77 less but is reduced by only $54. In this example, it cost me $54 to contribute $77 because I don’t pay tax on my contribution.
Remember, this is just an example for illustration purposes, and your plan types and associate plan provisions may vary.
Slide 7: Payroll deductions – Benefit from dollar-cost averaging.
There’s a graphic on this slide to help explain dollar-cost averaging. It shows the fluctuating price per unit of an investment over time. There’s a line though it that indicates the average price of the investment.
Presenter:
Are you one of the many Canadians who are concerned about where stock markets are headed? When it comes to investing your money, your main goal is no doubt to grow and preserve your wealth.
There are some investors that try to take advantage of the markets by trying to anticipate when investment prices will go up or down. This is so they can buy the investments at the lowest price and then sell them at their highest price, to make the most return on their investments. Sounds good right? Well unfortunately, the problem with this strategy is that it is considered a risky strategy, since we can’t predict the future.
Now dollar cost averaging is a different strategy where you invest the same amount of money on a regular basis, regardless of the price of the investment.
With dollar-cost averaging on the other hand, you invest a little money regularly, rather than a larger amount once in a while. By doing this you avoid the risk of only investing your money when the price is high and increase your chance of investing some of it when costs are low. It essentially averages out the cost of your investment.
The graph on our screen is showing an illustration of a unit price for an investment, that fluctuates between $14 and $20 over a period of time By investing $100 each month at differ prices, the investor in this example was able to buy their investment fund units at an average price of $17.25.
Now let’s tie this strategy back to your group savings plan. By making regular, repeated contributions through automatic payroll deductions, you receive the advantages of dollar-cost averaging. You buy the same dollar amount each time so when prices are low, you get more units. When prices are high, you get fewer units. This takes the guesswork out of when to invest and when not to invest.
Slide 8: More benefits of dollar-cost averaging
Lists three more benefits of dollar-cost averaging:
Keeps emotions out of investing decisions
Keeps you in the market
Beneficial for most investors – including ones who are just starting out
Presenter:
Before moving on, we would like to highlight additional benefits of the dollar cost averaging strategy.
It removes emotion from investing – Since you’re investing regularly rather than based on the positive or negative feelings you may experience when the market changes, it’s harder for your emotions to interfere with your decisions.
It keeps you in the market – Instead of trying to buy your investment at its bottom price and sell at its top price (which is called market timing and is extremely challenging to do as we can’t predict the future), dollar-cost averaging keeps your money invested so it’s there when the market rebounds.
Finally, dollar cost average is ideal for new investors – Because it allows you invest small amounts, it’s perfect for investors who are just starting out.
Slide 9: Low fees
Explains that group plans offer lower investment fees due to group buying power. There are no account or transaction fees, and investment management fees are lower than individual plans.
Presenter:
Another features of your group savings plan, that we are highlighting today, are the associated fees you pay on the investment funds you buy through your group savings plan, that will be typically lower than the fees associated when you invest outside of your group saivngs plan individually.
Your group plan provides group buying power. It is comparable to when you pay less when you buy in bulk.
There are no account fees, investment purchase or transfer fees and low investment management fees (known as IMFOEs)*.
Slide 10: Advantages of lower investment management fees
Illustrates how lower fees result in higher returns over time.
Visual description: A bar graph comparing investment growth over 25 years with a 5% return (group plan) vs. 4% return (individual plan). The group plan shows $6,432 more in growth.
Presenter:
Let’s take a closer look at investment management fees and fund operating expenses.
They’re the fees charged by investment managers for their professional services and for the operating expenses of the fund.
Investment management fees and operating expenses are expressed as a percentage that’s deducted from the funds value. That means the smaller the fees, the more of the fund’s returns are left for you.
This graphic illustrates how lower fees can lead to more savings over time.
In this example, my sibling and I have inherited $25,000 each. As not all Canadians have access to group savings plans, my sibling invests their $25,000 at their financial institution down the street from where they live.
My inheritance, was placed in my group savings plan.
For illustration purposes, we are going to assume we have invested the same way and have the same performance. The only difference will be the fees associated with my group savings plan are 1% lower than my sibling fees.
If we take a take a look over 25 years, the money grows in both plans, however in my group savings plan, will have a higher amount.
Another great opportunity for our viewers will be to review the fees associated with your group plan by signing into their profile on the member site, My Canada Life at Work.
Slide 11: Employer contributions
Notes that some plans include employer contributions, often as a matching program. Not contributing means missing out on part of your compensation.
Presenter:
Some group savings plans have employer contributions as one of their features. This is when your employer contributes to your plan up to a certain amount.
When employer matching is available, if you don’t take advantage of this feature, you’re potentially missing out.
As not all plans have this feature, we are not going to spend much more time reviewing this feature except to encourage our viewers to review their member booklets, that we highlighted earlier in our webinar, to review the contribution formula of your group plan, as there may be an opportunity to maximize this benefit.
Slide 12: Give more of your investments the group advantage
Encourages transferring savings from other institutions into your group plan. Instructions are provided for accessing the transfer form and getting help.
Presenter:
Based on the features of the group plan we have reviewed; some our viewers may be wondering if it may be possible to consolidate external savings into a group plan.
It will depend on your group savings plan and once again you can verify by referencing the member booklet.
Slide 13: Are you enrolled in your plan?
Title slide introducing the section on enrollment.
Presenter:
Now that we’ve discussed some of the best features of a group savings plan, let’s cover off how to enroll.
Slide 14: Ways to enrol
Lists three enrollment methods:
Online with guest ID and password
Auto-enrollment by plan administrator
Paper application submitted to administrator
Presenter:
How a member enrolls in their group savings plan, depends on the group savings plan’s design and it’s not the same for everyone.
Enrolment can be done online where your employer will provide you with the details to get started.
Enrolment may be automatic and completed by your employer, or you may be provided an enrolment guide that includes a paper application that will need to be completed.
Slide 15: How to check if you’re enrolled
Suggests checking your paystub, calling Canada Life at 1-800-724-3402, weekdays from 8 a.m. to 8 p.m. ET.
, or asking your plan administrator to confirm enrollment.
Presenter:
If you aren’t sure if you’re enrolled in your plan, there’s a few ways you can check:
Review your paystub to confirm if contributions are being taken off for retirement savings.
Call Canada Life at 1-800-724-3402, weekdays from 8 a.m. to 8 p.m. ET.
Ask your plan administrator.
Slide 16: Managing your plan online
Title slide introducing the section on online account management.
Presenter:
Now that we’ve discussed the features of your plan and how you can get started savings, let’s talk about how you can manage your savings on the member site, My Canada Life at Work, your online portal.
Slide 17: My Canada Life at Work – Your online portal to your savings
Provides the website address: mycanadalifeatwork.com and tech support number: 1-888-222-0775.
Presenter:
Signing in to My Canada Life at Work is the first step to managing your savings throughout your savings journey.
If you haven’t signed in before, today is the day my friends, you’ll need to register using your policy and certificate number. You can find these numbers on the second page of your mailed statements under key information.
If you’ve previously received an email inviting you to register, it may also have this information.
For help signing in, we have technical support line at 1-888-222-0775 that is there to provide support and guidance, weekdays from 8 a.m. to 8 p.m. ET.
Slide 18: What can I do on My Canada Life at Work?
Lists features of the site:
View balances
Change investments
Update beneficiaries
Access statements and tax receipts
Set and track retirement goals
Presenter:
What can I do on My Canada Life at Work? It is more like what can’t you do.
Once you sign in you are able to:
Review and manage your savings plans any day at any time
Find your total balance and personal rate of return
Review or change your investment selection. Let’s pause here for a moment as we would like to talk about how your investment choices can make a big impact on how much you’re ultimately able to save before retirement
A best practice is to go online regularly to review your investment selections to make sure they’re still in line with your goals.
If you aren’t sure how to choose the best investments for you, join us for our upcoming webinars that teach the basics of investing later this year and the tools and support that are available/
Slide 19: Add or change a beneficiary (if applicable)
Step-by-step instructions for updating beneficiaries through the online portal and a screen shot of the website.
Presenter:
When you are signed in, you may want to make sure your beneficiary is up to date, if applicable.
This is an area many members have questions about.
Let’s review how to do it online - it can take less than 5 minutes.
Here’s how to do it online:
Select the person icon at the top right of your screen.
Select Your profile.
Then choose Beneficiaries and dependants and then view.
Select Edit beneficiaries for any group savings plan you would like to make changes to.
Slide 20: Our favourite feature – Retirement goal tool
Describes a tool that helps estimate how much you need to save for retirement, including government and personal savings.
Presenter:
One of the most useful features of My Canada Life at Work is the Retirement goal tool.
It’s an easy-to-use calculator that you’ll find on the Overview screen when you sign in.
It can help you figure out how much savings you need to achieve your desired retirement.
Slide 21: Retirement goal tool - results
Shows the outcome of using the retirement goal tool.
Visual description: Screenshot of summary showing projected savings needs and progress toward retirement goals.
Presenter:
Once completed, you will receive 1 of 2 empowering messages.
‘Congratulations! You are on track to achieving your retirement income goals’.
Or, it may tell you that you are not on track and provide you suggestions to get you on track or back on track.
Slide 22: Update your contribution amount
Gives instructions for increasing contributions based on your retirement goal tool results. You can do this in two ways:
You can do it online by navigating to the contributions part of My Canada Life at Work
Or by contacting your plan administrator directly
Presenter:
Your retirement goal tool results may lead you to wanting to make changes to the amount you’re contributing. This is something that you may be able to do online directly through Canada Life, or you may have to contact your payroll team to make these changes.
Slide 23: Don’t wait to sign-in
States that members who log in to the site have 30% higher average savings balances than those who haven’t. The statistic sourced from Canada Life data as of August 31, 2024.
Presenter:
We encourage members to not delay signing in to My Canada Life at Work.
Digitally engaged employees fare better in their retirement savings.
Members who have logged into My Canada Life at Work have average savings balances that are 30% higher than those who haven’t.
Slide 24: More perks of your plan
Title slide introducing additional benefits of being a plan member.
Presenter:
Now let us focus on the perks of your plan that can help you with your overall wellbeing.
Slide 25: Workplace Strategies for Mental Health
Describes free resources for mental well-being, including topics like conflict management, accommodations, and mental health tips. Includes a screenshot of the landing page and site url: workplacestrategiesformentalhealth.com.
Presenter:
Workplace Strategies for Mental Health is a leading online source of free, practical tools, resources and programs designed to help all Canadian employers and employees improve psychological health and safety in the workplace and beyond.
Here are examples of topics covered:
Managing workplace conflict and bullying
Approaches for workplace accommodations
Tips for improving and managing your mental health
Through workplace strategies for mental health:
You can increase your knowledge and awareness of workplace psychological health and safety
Help respond to mental health issues at work
If you’re a manager, it can be a great resource for strategies and tools to respond to employee issues at work.
Slide 26: Credit Counselling services
Lists two services:
Credit Counselling Society (nomoredebts.org, 1-877-636-8999)
Solve Your Debts (solveyourdebts.com, 1-888-753-2227)
Presenter:
To help improve your financial wellness, we have partnered with the award-wining, not for profit Credit Counselling Society and the Credit Counselling services Atlantic Canada. If you’re not sure how to manage your debt, credit counselling may be able to help.
Your group savings plan gives you access to certified credit counsellors who you can talk with you confidentially. They’ll ask members how they were referred, and members should mention they’re a Canada Life member.
Slide 27: Wills and estate planning
Outlines services available at discounted rates:
Online will creation
Estate planning guidance
Executor support
Presenter:
Estate planning doesn’t have to be costly or time consuming. Your plan includes discounted wills and estate planning services you can access online.
Create a legal will online
Discounted rate of $50+ HST for Canada Life plan members (regular price $249+ HST)
+ $19/year for access to a digital vault and unlimited edits to your will so you can make changes as your personal situation evolves
Includes power of attorney documents
Estate planning
Personalized guidance and support from estate experts
Preferred pricing with a 5% discount for services for Canada Life members
Executor support
Free online executor support for you or your appointed executor ($80 value)
Slide 28: Why does it matter?
States that half of Canadian adults do not have a will.
Explains that dying intestate means your estate is distributed by law, which may not reflect your wishes and could create tax burdens for your loved ones.
Presenter:
Why is estate planning important?
Half of Canadian adults say they don’t have a will and half of seniors aged 65+ have not updated their wills in the last 5 years.
If you die without a will in Canada or a designated beneficiary on your registered accounts (if applicable) , your money, assets and debts are put into an estate. A court-appointed representative closes your financial affairs and distributes your assets according to the rules and regulations of your province. Besides a loss of control over dispersal of assets, there are also potential tax burdens that can be passed on.
Slide 29: Accessing credit counselling and wills and estate planning services online
Instructions for accessing these services through My Canada Life at Work along with a screenshot:
Sign in
Select “Options for you”
Choose “Learn more” for the desired service
Presenter:
To benefit from discounted rates for credit counselling and wills and estate planning services, you’ll need to contact them through the links provided on My Canada Life at Work.
You’ll find the links under the “Options for you” tab when you sign in.
Slide 30: Saving for Life
Describes educational resources:
Monthly webinars. Register at canadalife.com/saving-for-life-webinars.
Biannual newsletters with plan updates
Self-serve tools on My Canada Life at work and canadalife.com/smartpath
Presenter:
Would you like to continue your retirement and savings education journey?
Consider registering for more of our webinars on a variety of different topics that members have been requesting.
Keep an eye on your email inbox for the semi-annual Savings for Live newsletter which will provide you insights about your plan and your savings goals.
If you’re not receiving it, registering on My Canada Life at Work can help ensure we have your email address on file.
Head over to canadalife.com/smartpath to access articles, videos and calculators
Slide 31: Best practices
Includes 5 colourful icons with one tip below each:
Reading your member booklet
Enrolling when eligible
Signing in regularly
Increasing contributions when possible
Using available tools and resources
Presenter:
Let’s finish by reviewing what you can do to make the most of your plan:
Make sure you understand what’s available to you by reading your member booklet.
Enrol in your plan as soon as you’re eligible to join – don’t wait to enjoy its benefits.
Sign into My Canada Life at Work and review your group savings plans regularly.
Increase your contribution amount when you can, if your plan allows you to and
Use the tools and resources available to you to support your overall well-being.
Slide 32: Want Help?
Contact information for Canada Life:
Help with your plan
1-800-724-3402 8 a.m. to 8 p.m. ET Monday-Friday
Help with My Canada Life at Work
Tech Line 1-888-222-0775
Bottom of the slide has the following disclaimer and trademark line: The information in this publication is general in nature and is intended for educational purposes only. Furthermore, there can be no assurance that any trends described in this material will continue or that forecasts will occur. Past performance is not necessarily indicative of future performance.
Presenter:
Our goal was to share with you how your group savings plan can play big role in helping you achieve the financial goals you have set for yourself and your desired retirement lifestyle.
Be sure to watch our other webinars to keep learning about money and about your group savings plan.