Understanding your Benefits - The Importance of Knowing What You Have
• Benefits is one of the most overlooked parts of employee compensation.
• Most of us do not realize the actual cost of medication and dental care.
• The Canadian Medical Association released a report stating many Canadians are not receiving medical care due to cost.
• Dental care is key to long term health; however, we talk to many people who do not receive treatments.
• The ability to make money is our most important asset, yet most employees do not have or understand their disability plan.
• When you are reviewing your financial plans with an advisor it's essential to understand your benefit plan.
• If you are self-employed, or without a benefit plan, you need to plan how to cover gaps.
The two largest long-term costs many Canadians will face: health care and retirement. A good benefit package helps to enable your optimal health and productivity. A drug plan, dental care and access to various medical professionals is important as many governments are fiscally strained to cover many basic health care needs.
Retirement today has changed. Most employers do not provide Defined Benefit Plans, which were most popular a generation ago. The cost of this type of plan has become prohibitive for most employers. The most common plan employers offer is a Defined Contribution Plan and a group RSP. This plan is most often matched with employee contributions. The employees make the investment decision based on the plan investment options.
Saving for retirement has become more difficult as Canadian savings rates are at all time lows. Contributing to a group retirement plan can provide you with the vehicle and discipline to save on a regular basis.
As a part of any good financial plan, it is important to review your benefits and retirement programs to make sure you are taking advantage of the opportunities the program offers. Your group benefit plan is a part of your compensation. It is in your best interest to maximize it!