Awani Review

Complete News World

2021 was a good year for retirement plans

2021 was a good year for retirement plans

2021 and the Omicron variant won’t have the best defined benefit (DB) plans that have remained well funded through the last quarter of the year.

• Read also: What 2022 holds for you: Inflation will affect every aspect of your finances in 2022

• Read also: The year Quebec employees achieved the grand end of the baton

This was announced Tuesday by the “Mercer Index of Financial Health of Retirement Plans.”

According to the index, DB Plans has a solvency rating of 103% as of December 31, 2021, an increase of 2% from September 30 and 7% from the start of 2021.

“As the financial position of DB plans continues to improve, many plan sponsors are finding their plans to have surpluses, which is an enviable situation. Although surpluses are better than deficits, they come in handy,” said F. Hubert Tremblay, senior equity advisor at Mercer. With its share of repercussions and challenges that must be managed.

2021 was a good year for DB plans due to the reopening of the global economy, high vaccination rates as well as increased vaccine availability.

«[Ainsi,] Many promoters will see their retirement plans enter 2022 in good financial shape, which will put them in a good position to face the significant hurdles that could arise,” one can read in a press release.

So Mr. Tremblay recommended that promoters review their exposure to risk and, if possible, crystallize a portion of the gains for 2021. “Promoters will not want their surpluses to turn into deficits because of their inaction,” he added.

See also  MSSS on Origin of the Data Breach on the Clic Santé website

Inflation and the question of whether it will truly be temporary, the implications of the Omicron variable on metrics, the potential emergence of new variables, the political impasse in the United States and heightened geopolitical tensions are also the main obstacles projected for 2022.

As we head into 2022, we are generally optimistic about the economic outlook. Strong income growth and consumers’ balance sheets must continue to support consumption. Public spending and investment are expected to remain high over a long period.

“Reimposition of pandemic-related restrictions could dampen growth early in the year, but we expect growth to pick up after the wave of the Omicron variable, putting economies back on track leading to a full recovery,” stressed Jean-Pierre Talon. Member of the Avoirs de Mercer Partnership.