I have rewritten and added more up-to-date information. It’s interesting how private pension membership has grown.
Stats Canada provides a lot of information. I always find interesting spins on some of the stuff. No, I am not going to comment on Frozen Chicken Futures. March 2007, they published the value of Employer Pension Plans in Canada. This is the value of employee pension plans that their employers administer. They lost value last quarter (of 2006) but have since rebounded.
What is more interesting to me is the following interesting statement:
About 4.6 million Canadian workers are members of trusted plans. Of these, 2.5 million are public sector workers in municipal, provincial, and federal governments and enterprises, crown corporations, government boards, commissions and agencies, and public educational and health institutions. Private sector workers make up the remaining 2.1 million.
Public pension plans March 2007
Over 4 million Canadians are in a Pension Plan of some kind. I think that is a pretty good thing. Remember, a pension means you have income other than the Canada Pension Plan. You can use your RRSP money as savings if you can live on your pension.
At the time I was a member of an excellent pension plan that is unfortunately capped for me. I understand why Nortel did this. More private companies seem to be discovering just how burdensome a Pension Plan can be. It's not just about administering it. They also have to keep money in it.
Suppose you have a pension, good for you. If you don't, better make sure your RRSPs are getting their maximum. You will be able to live on your CPP benefits.
Pensions in 2023
Over two-thirds of registered pension plan membership are covered by defined benefit plans
Over 4.7 million Canadians were active members of a defined benefit (DB) pension plan in 2022, up 3.3% from 2021. Membership in DB plans accounted for 68.1% of the total membership in RPPs in 2022, up 0.1% from 2021. Female membership made up 55.9% of total DB membership in 2022.
Pension plans in Canada, as of January 1, 2023
Looks like there are more folks in pensions now? Not a great deal, but I would have thought there was going to be a decline.
My Pension Status
When I first wrote this I was in the Nortel Pension Plan. Luckily, I got out of it before it collapsed. My statement about pensions being funded (above) seems to have been a bit of foreshadowing. I transferred the money to my PSPC pension, so I "landed in butter". Others were not as lucky.
So… Do You Have a Pension Plan?
If you do, that’s great—just make sure you understand how it works and what it promises. If you don’t, that’s okay too—but start building your own retirement strategy today.
Plan like your future depends on it—because it does!
References on Pensions
- Pension plans in Canada, as of January 1, 2023 (Statistics Canada)
A comprehensive update on the number and type of registered pension plans in Canada. It highlights the continued dominance of defined benefit plans, despite ongoing shifts in the retirement system. - Overview of the Canada Pension Plan (Government of Canada)
The official Government of Canada resource explaining eligibility, contributions, and benefits under the Canada Pension Plan (CPP)—a foundational pillar of retirement income. - The Canadian Retirement Income System (OECD)
A global snapshot of Canada’s retirement income structure, offering context for how pensions (public and private) interact with programs like OAS and GIS. - DBRS Report: Pension Tension – The Future of Canada’s Retirement System
This report discusses long-term risks to pension sustainability, such as aging demographics, low interest rates, and shifts in employer offerings.
Didn’t I see you on an Ad for an insurance company touting “Freedom 55”? 🙂
Good on you for planning well, you are in the minority!
–C8j
I’m actually doing what George suggested. I retired early with a good government pension at age 55 several years ago. My pension covers all of our basic, pre-retirement expenses.
Our savings, most in RRSP accounts, have paid for retirement extras such as moving from Manitoba to Vancouver Island and for the purchase and operation of our sailboat. I plan to start taking CPP at age 60.
Having the extra money saved over and above my pension made it possible to take early retirement.
It’s actually not a bad idea to contribute to a RRSP even if you have a good pension plan. The funds can be used as an “early retirement” fund, to provide income in the years after retirement but before CPP and your pension kick in.
Because of the pension adjustment, the amount you are allowed to put into an RRSP is lower than people without a pension plan.
Absolutely I did not mean to imply that if you have a pension you are set for life, more that if you DON’T have ANY pension, you had better start saving NOW for your retirement. RRSP contribution is important whether you have a pension or not.
–C8j