Capital Accumulation Plan Benchmark Report highlights strategies to help employers create successful group retirement programs

Video: Jeff Aarssen (Great-West Life) highlights strategies for group retirement plan success

Infographic: Strategies for group retirement plan success (CNW Group/GREAT-WEST LIFE)

WINNIPEG, March 6, 2013 /CNW/ - Research unique to the Canadian Capital Accumulation Plan (CAP) market is now available through Looking Forward, the 2012 CAP Benchmark Report sponsored exclusively by The Great-West Life Assurance Company.

"The CAP Benchmark Report allows sponsors to benchmark their plans in order to create and maintain a successful group retirement program that is competitive and helps better position each member to reach their retirement income needs," says Jeff Aarssen, Vice-President Group Retirement Services Sales & Marketing for Great-West Life.

The report also highlights strategies employers can use to dramatically improve their group plan participation, enable better-suited investment choices and ultimately assist more plan members in reaching their retirement goals.

These strategies include: encouraging early enrolment, promoting meaningful contributions, lessening the impact of withdrawals and providing investment choice including age-adjusted mix options.

"Plan sponsors are making efforts to help their plan members reach their retirement income goals but there is still opportunity for improvement," Aarssen says. "Advisors can also use this research to provide their clients with further insight into survey results and recommend plan design enhancements."

Now in its eighth year, the benchmark report is based on a survey by Benefits Canada / Canadian Institutional Investment Network of 380 organizations offering a defined contribution (DC) plan. Read the full report here. An educational video with commentary by Jeff Aarssen is attached and can also be viewed at

Strategies and survey findings

  • Encouraging early enrolment: Many plan sponsors of CAP plans are taking steps to ensure members are enrolled as early as possible so that members can benefit from tax-effective growth of compound interest, investment returns and low investment management fees. Most DC plans (71 per cent) have mandatory participation and over half (57 per cent) of Group RRSPs and 32 per cent of DC plans offer immediate eligibility. These strategies help ensure members take advantage of the savings vehicles their employer has offered them and better position them to meet their retirement income needs.
  • Promoting meaningful contributions: Plan sponsors can help promote meaningful contributions by making attractive matching contributions, as the majority of plan members continue to make contributions that attract the maximum employer match. In 2012, the average employer match was 5.6 per cent for DC plans and 3.8 per cent for Group RRSPs.
  • Providing investment choice and addressing age-adjusted investment risk: Increasingly, plan sponsors are making age-adjusted investments available, such as target date funds as their default option so that plan members' savings are more inclined to grow even if the member never makes an investment decision. In 2012, 34 per cent of DC plans made target date funds their default option, up from 16 per cent in 2011. For group RRSPs, 28 per cent were target date funds, compared to 15 per cent in 2011.
  • Lessening the impact of withdrawals: Effective retirement saving requires that plan members keep their contributions in the plan so they benefit from tax-effective compound growth on their investment returns. As such, plans sponsors should structure plans to discourage withdrawals.

Survey methodology

Managed by Rogers Publishing Ltd., the 2012 CAP Benchmark Report summarizes the results of updating plan sponsor profiles in the Canadian Institutional Investment Network as well as the findings from an online survey. The report represents an unbiased view of Canadian group retirement market trends.

Data was collected between February 1 and August 8, 2012 from 380 organizations offering a Defined Contribution (DC) plan (308 plan sponsors) or a group RRSP (180 plan sponsors) to their employees. In total, 308 respondents have a DC plan and 180 have a group RRSP. Results depend on the specific organizations that complete the survey, which vary from year to year.

About Great-West Life

Great-West Life administers over 17,000 group retirement plans and over 1.3 million member accounts, representing over 30 per cent of capital accumulation plans (CAPs) offered by insurers in Canada. In the United States, Great-West is the fourth-largest group retirement plan recordkeeper based on total participants and Putnam Investments adds to the organization's North American presence in this market.

Video with caption: "Video: Jeff Aarssen (Great-West Life) highlights strategies for group retirement plan success". Video available at:

Image with caption: "Strategies for group retirement plan success (CNW Group/Great-West Life Assurance Company)". Image available at:

PDF available at:

SOURCE: Great-West Life Assurance Company

For further information:

Marlene Klassen, APR
Assistant Vice-President, Communication Services

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