TORONTO, May 13, 2021 – The Common Good Plan has launched a new retirement plan to strengthen the financial health of workers in Canada’s not-for-profit sector – a group hard hit by the COVID-19 pandemic.
The Common Good Plan is a consortium of prominent not-for-profit leaders, philanthropic foundations, and retirement security specialists dedicated to creating a nationally portable retirement income plan for the not-for-profit sector – among the most vulnerable workers in the Canadian economy.
“We know that access to high-quality plans is one of the foremost ways Canadians can save enough for their retirement,” said Rahima Mamdani, Chief People Officer at YMCA of Greater Toronto, and a member of the Common Good Plan’s Steering Committee. “The Common Good Plan fills an important need by offering a simple and effective means of saving for the future. It’s an excellent offering for employers and a huge benefit to workers who can trust that their interests are being looked after.”
The Common Good Plan provides an innovative retirement platform that helps Canadians turn savings into retirement income 2-3 times more efficiently than a typical RRSP. Administered and supported with technology created by Common Wealth Retirement, the Common Good Plan is structured as a Group TFSA / Group RRSP that focuses on monthly income, is sensitive to the needs of modest workers, has low fees, and is portable from job to job.
“We see ourselves as a partner in empowering Canadians to prepare for retirement. Common Wealth was built on a very big idea: that if we do the right thing, if we take care of each other and challenge the status quo, we can take steps towards reducing income inequality. Because everyone, including those in the not-for-profit sector, should have the chance to build substantial wealth through their retirement savings,” said Alex Mazer and Jonathan Weisstub, Co-founders of Common Wealth Retirement.
This initiative can help workers to rebuild their financial security, enabling a typical worker to realize hundreds of thousands of dollars in additional lifetime benefits, compared to a typical retirement savings approach, based on recent research done by Common Wealth and the Healthcare of Ontario Pension Plan.
The plan offers tailored retirement solutions that are not currently available through market offerings or other workplace savings programs. The median retirement savings among near-retirement households without workplace pensions are a mere $3,000. Studies show more than four in ten Canadians are living paycheque to paycheque, and 10 million Canadian workers are without a workplace retirement plan.
“What we’ve learned in this field is that leaving people on their own to figure out how much they should be saving, how they should invest the money, and what they should be doing once they retire is extremely difficult for people,” said Keith Ambachtsheer, Director Emeritus of the International Centre for Pension Management, and an expert advisor to the Common Good Plan. “So any kind of collective arrangement that thinks through these things on their behalf and manages this program through time is of tremendous value to these people.”
Addressing the retirement gap will also benefit Canadian employers, who currently lose billions of dollars annually due to staff turnover, reduced productivity, absenteeism, and presenteeism caused by employee financial problems.
“Financial resilience is always important, but even more so right now. That’s why programs such as the Common Good Plan – which extends the opportunity for small businesses and non-profits to foster savings among their employees – will allow more people to have greater financial security,” said Christine Bergeron, President and CEO of Vancity.
The Common Good Plan has also partnered with SmartSAVER and Prosper Canada to provide access to additional government benefits: education savings grants using the online MySmartFUTURE application and COVID-19 emergency benefits and relief supports through the Financial Relief Navigator.
Thanks to renewed support from Vancity, Maytree, the Hamilton Community Foundation, and the Metcalf Foundation, the Common Good Plan has onboarded an initial cohort of 25 employers from across Canada, including BC Association of Farmers’ Markets in British Columbia, Pinnguaq in Nunavut, Gerstein Crisis Centre in Ontario, and Halifax Theatre for Young People in Nova Scotia.
“We applaud the work of the Common Good Plan to support the people who have chosen a career path in the non-profit sector,” said Heather O’Hara, Executive Director of the BC Association of Farmers’ Markets. “A retirement strategy for our sector is long overdue and will build greater equity and incentivize and reward the talented and dedicated people who join and stay in organizations like ours. BCAFM is proud to be participating in the plan.”
Recently featured in The Philanthropist, the coalition will continue to pursue new partners and funders to help scale this high-quality retirement plan and ensure all workers, including the self-employed and freelancers, have access to affordable and effective savings support that builds their financial wellness and resilience against future economic shocks.
Canadian employers and workforce partners interested in joining Common Good Plan can visit commongoodplan.ca for more information.