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Advocacy Resources Pillars of Retirement

Understanding the three pillars

Three pillars of retirement

The “three pillars of retirement” is an analogy used to describe the three most common sources of retirement income in Canada: government programs, workplace retirement savings arrangements and personal savings. These sources work together to build the financial foundation of a secure retirement for Canadians.

But what happens to the foundation if one or more of these pillars are inaccessible, or if they aren’t as strong as the others? This is the reality for many Canadians, particularly those who are unable to save for retirement or who do not have access to a workplace retirement savings arrangement. Before we explore the impact on Canadians, let’s take a closer look at each pillar:

Point #1 Government programs

Government programs

These are publicly funded plans administered by the government that can help provide financial security to eligible Canadians. They include the Canada Pension Plan (CPP), Old Age Security (OAS) and Guaranteed Income Supplement (GIS).

Point #2 Workplace retirement savings arrangements

Workplace retirement savings arrangements

While these arrangements may vary in administration, they’re based on employee and employer contributions. They include defined benefit (DB) pension plans, like HOOPP, defined contribution (DC) pension plans and group registered retirement savings plans (RRSP).

Point #3 Personal savings

Personal savings

Individuals can save for their retirement using registered retirement savings plans (RRSP) and/or tax-free savings accounts (TFSA).

While it’s long been assumed that with access to all three sources of retirement income any Canadian can be financially secure in retirement, it’s rarely so simple.

Many Canadians don’t have access to a workplace retirement savings arrangement or don’t know how much money they actually need to fund a secure retirement; most say that saving for retirement is prohibitively expensive and that setting aside enough money for retirement is next to impossible.

Without significant personal savings or access to workplace retirement savings arrangements, this leaves many relying on only one pillar – government programs. These programs aren’t designed to be the only source of retirement income for Canadians and, for most, don’t provide nearly enough to live on.

HOOPP advocates for better access to workplace retirement savings arrangements because we’re all better off when everyone has access to a financially secure retirement.

Did you know?Did you know?

More than half of Canadians say they’re concerned about not having enough money in retirement, while the vast majority of Canadians think all workers should have access to a workplace pension plan. Learn more in our 2023 Canadian Retirement Survey.

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This document provides a simplified overview of HOOPP's benefits based on the terms of the HOOPP Plan Text at the time of publication. From time to time, HOOPP may amend the HOOPP Plan Text. In cases where the information provided in this document differs from that contained in the HOOPP Plan Text, the HOOPP Plan Text will govern. More details, including the full HOOPP Plan Text and a complete description of the Plan and its benefits, can be found on hoopp.com.