Heading into what proved to be an extremely tumultuous year, Canadians’ retirement savings enjoyed a strong 2019, according to data from Statistics Canada.
Last year, Canadians’ pension wealth rose by 10.4% to $4.25 trillion on the strength of robust equity markets — the S&P/TSX index rose by 19.1% and the S&P 500 index gained 28.9% during the year.
Market gains, investment income and contributions all added to total pension wealth, offset by withdrawals.
StatsCan reported that all three tiers of the Canadian pension system — employer-based pensions, individual registered savings plans, and social security (Canada Pension Plan/Quebec Pension Plan) — recorded asset gains during the year, even as withdrawals continued to outpace contributions (excluding old age security).
The social security plans led the way, with assets rising 13.5% in 2019 driven by a 14.1% gain for the Canada Pension Plan.
The value of individual registered saving plans increased 11.3% and employer-based pension assets rose 9.3%.
In terms of total assets, workplace pensions finished the year with $2.4 trillion, followed by individual plans at $1.3 trillion and $503 billion in social security.
StatsCan noted that pensions took a hit along with the financial markets in the first quarter of 2020, but have since recovered those losses.
“There is still a large amount of uncertainty regarding the ongoing impact of the pandemic on financial markets and economic growth, especially as some economies enter a second wave of infections,” it said.