Most Canadian plan members feel secure saving for retirement, but only 25 per cent feel ready to spend in it, finds BlackRock research
Canadian workplace plan participants are saving at healthy rates, but the retirement system has left most of them without a clear plan for what to do with the money once they stop working.
That’s the central finding of BlackRock’s 2026 Canada’s Read on Retirement report, the firm’s first Canadian edition of the series, which surveyed 1,009 workplace plan participants and 305 retirees between May and June 2026. The report found that 61 per cent of participants feel on track for retirement, yet 68 per cent worry about outliving their savings, and roughly three quarters struggle to connect current contributions to a long-term spending plan.
Nick Nefouse, managing director and global head of retirement solutions at New York-based BlackRock, calls these findings “the clarity gap”.
“The clarity gap is that people do a very good job saving for money where there’s access, to be clear. They feel secure,” he said. “But if you look at them, only about 25 per cent of people feel they’re ready to spend in retirement. It’s not clear if it’s financial insecurity or just insecurity because I don’t know what I’m doing.”
Economic anxiety hits savings rates
While the savings systems in Canada, the US and Australia have done their job where access exists, with participation rates and balances both holding up well, the industry has failed to educate people on how to convert those balances into retirement income or help them understand what government benefits like CPP and OAS will provide, Nefouse said.
Additional findings from BlackRock’s report cited that 72 per cent of respondents said they might need to slow down their contributions in the coming year. Nefouse tied that finding to broader economic anxiety rather than a structural savings problem. He acknowledged how market volatility and inflation have made workers uncomfortable, pointing to some US surveys that have shown similar patterns, like participants signalling they plan to cut retirement contributions as the cost-of-living rises.
Canada also appears to have a slight edge over the United States in accumulation-phase confidence, which Nefouse attributed in part to higher coverage rates for defined benefit and defined contribution plans across the country. But that advantage fades at the point of retirement, where stress levels converge across both markets.
While strong market returns in both Canadian and US products have offset reduced savings rates for now, he cautioned that relying on investment performance to compensate for lower contributions is not a sustainable fix.
Why plan sponsors need to consider the retirement window
To that end, Nefouse argued that plan sponsors need to concentrate on what BlackRock calls the “retirement window” - the period between ages 55 and 70 - where the real gaps in understanding emerge. Workers in that range need help grasping what their account balance means in practical spending terms or how to convert lump sums into cash flow, and what government benefits will deliver.
“When we’re working, we think about wealth accumulation. More money is better than less money. That’s great, but in retirement, you’re supposed to spend that money,” he said. “What ends up happening is they just anchor to their final account balance and then they’ll sit on that money.”
While BlackRock also found that Gen Z participants report higher confidence than Gen X, despite the latter being closer to retirement, Nefouse acknowledged the pattern shows up everywhere - younger workers who are saving and getting a company match feel they’re doing what they need to do, while Gen Xers approaching the retirement window face a growing list of decisions they’ve never been prepared for.
The shift from accumulating to spending creates stress regardless of how well someone has saved, said Nefouse.
“Even if we get perfect education, I still think people are going to have more stress as you're about to get into retirement than when you are much younger,” said Nefouse.
Embedding planning into the workplace
To that end, Nefouse said closing the understanding gap comes down to tools but not in the way most plan sponsors think. What plan sponsors need to do is begin to embed retirement planning into the workplace culture through benefit fairs and earlier engagement, ideally in workers’ late 40s and early 50s, when small increases in savings can compound into meaningfully larger balances by retirement.
The types of tools BlackRock has built factor in account balances, mortality probabilities, and capital market assumptions — including market volatility and expected returns - to estimate a spending rate participants can use to frame their retirement.
While incorporating government benefits like CPP and OAS into those calculations remains a challenge in Canada, Nefouse emphasized the goal is to give participants a number that is directionally accurate rather than prescriptive. “It’s not going to give them a prescriptive number. It’s a directionally accurate number that they can frame their retirement around,” he said.
Advisors in the workplace
That’s why he believes financial advisors to be essential to the retirement equation because the problem is fundamentally behavioural, not mathematical.
“In retirement, it becomes behavioural. Two people in the same company, in the same demographic, in the same town could get to retirement and have two very different views of retirement,” said Nefouse.
“One person could say, ‘I've saved the right amount of money for retirement, and I want to just spend safely for the rest of my life because I worked so hard to get here,’ while somebody else can say, ‘I worked my whole life. I've had all this money and now, I want to blow my money and go on vacations and cruises and do all kinds of fun things I didn't get to do while I was working,’” he said.
For that reason, BlackRock has identified four investor archetypes that retirees tend to fall into: total return investors, who most people assume they’ll be but few actually are; income protection investors, who prioritize safety and lifetime income; risk wrap investors, who want growth but with downside protection; and time segmentation investors, who favour liquidity through instruments like bond ladders.
Nefouse said there’s no reliable way to predict which archetype a person will land in, even within the same workplace or profession but it’s that unpredictability that makes tools alone fall short.
When asked what plan sponsors may be overlooking, Nefouse said the answer is straightforward. Most employees already trust their employers to lead these conversations – particularly as retirement nears. The issue isn't willingness. It's that too few sponsors have extended their engagement beyond the accumulation phase.
“It’s spending more time with people in that retirement window, not in the accumulation phase,” he said. “Instead of just saying it’s about wealth maximizing, it’s about converting that wealth maximization into consistent spending.”
