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A version of this article originally appeared on BenefitsCanada.com.

By the end of January, there will be enough new retirees to fill the Air Canada Centre, Jean-Philippe Provost, senior partner and wealth business leader at Mercer, said at a Toronto event Wednesday.

Currently, 5,000 Canadian workers retire each week, a number expected to jump to 8,000 by 2020. While retirees can expect to live, on average, seven years longer than those who retired 30 years ago, their savings may not enjoy the same longevity.

Sixty per cent of retirees rely on Canada Pension Plan, Old Age Security and personal savings, Provost told participants at Mercer’s annual retirement outlook and forecast event in Toronto. Thirty per cent have a defined benefit plan, and 10 per cent have some sort of capital accumulation plan. While Canada is currently one of six countries where defined benefit plan assets comprise more than half of the funded pension system, 30% of corporate plans could be defined contribution ones by 2030. “The world is really going defined contribution, whether we like it or not,” said Provost.

Read: Decumulation and retirement tips

Of the defined benefit plans that remain, more and more are uncomfortable managing longevity risk and are looking to de-risking strategies such as group annuities. In 2012, for example, defined benefit plans bought $2.2 billion worth of group annuity contracts, a number that jumped to $3 billion last year. This year, Mercer expects a further increase to up to $5 billion.

Plan sponsors and advisors will also have to respond to trends such as the rise of independent contractors. By 2050, Provost said, up to half of the workforce could be freelance. “It’s going to change the dynamic of what people are buying and how they’re paying for it,” he said of the impact on pension and benefit plans.

Read: Retirees anxious about money? Here’s help

Provost also pointed out that while millennials will make up an increasing share of the workforce, only 10% of them think about saving. Furthermore, just 5% see the link between saving today and preparing for retirement. To address the issue, Provost noted, employers (and advisors) need to communicate with people of all ages more often and not just when plan changes come into effect or at the start of the fiscal year.

Advisors should reach out when clients are willing to listen and adjust their behaviour, which varies depending on the person. It could be when a client joins a new company, becomes a parent, receives a promotion, pays off their mortgage or needs to take care of an elderly family member.

Also read:

A third of working Canadians have no retirement savings: poll

Clients dish on positives, negatives of retirement

Originally published on Advisor.ca
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