Most Canadians with group savings and retirement plans find their financial statements unclear and ineffective, according to a recent survey commissioned by Standard Life.

In a poll of more than 1,300 Canadians conducted by Ipsos Reid, only 22% of group savings and retirement plan members gave their statements a high grade for clarity and an appropriate level of detail. Nearly three-quarters of plan members said their statement doesn’t contain enough information to prompt adjustments to their retirement plan.

Nearly half of those with a group plan do not know what their future retirement income will be, and 41% are unaware if their current rate of retirement saving is on target to meet their future income needs.

Almost 90% of Canadians with workplace retirement plans said they rarely or never make adjustments to their retirement investment portfolio based on information contained in their financial statements.

“What this research is saying is that the status quo is not working, and action is needed to make group savings and retirement statements more relevant and effective for retirement planning purposes,” said Anna del Balso, assistant vice-president, research and intelligence at Standard Life. “The financial services industry faces a clear communications challenge to fashion easily understood statements that inform, engage and, when necessary, provoke a change in direction.”

The study revealed that workplace retirement plan statements are not widely used because they are hard to understand and lack personalized recommendations and specific suggestions to improve retirement income.

The majority of respondents said they either “skim over” their group plan statement or ignore it all together. About a third said they’ve have arranged to have professional help to read their statement.

Standard Life notes that it’s critical for defined contribution plan members to have clear financial statements with actionable recommendations, since they’re responsible for their own retirement income planning.

Currently, 3.3 million Canadians – over 40% of those with group pensions – are covered by workplace defined contribution plans or group RRSPs, and that number is expected to rise in the future.

IE