New study compares your Canada Pension Plan to private or public options

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A researcher with the Fraser Institute says comparing the Canada Pension Plan to private and public sector pension plans is like comparing apples to oranges.

Moin Yahya said it released today’s study comparing the pension systems, after the federal and provincial governments decided to expand CPP coverage and increase premiums.

READ MORE: Reality check: Is CPP going to be around when you retire?

He says their study found that private pension plans have regulatory and legal burdens the CPP does not, because the private pensions have characteristics that the CPP doesn’t.

“You should be aware of this is why your plan might be a little costlier than the CPP, but it’s because you’re getting a better product or maybe a more diverse product or a more… nuanced product than just the plain vanilla CP,” he said.

READ MORE: CPP death benefit change panned as insufficient to cover funeral costs

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“If you still wanted to have CPP expand, then at least you’ve done so with full disclosure, but you should be aware of what the trade-offs are.  This is going to affect the quality and quantity of offerings that their own pension plans will be able to deliver.”

Yahya says it’s important for people to understand what drives the cost differences between the CPP and private and public alternatives.