The confidence gap quietly costs cautious Canadians thousands in retirement wealth
An 86 percent gap in retirement savings separates Canada’s most confident investors from their least confident peers, according to Sun Life’s new Member Mindsets, Motivations and Metrics report.
Based on an online Ipsos survey of 1,981 Sun Life group savings plan members aged 25 to 75 across Canada, the report finds that confidence, more than knowledge alone, shapes how workplace plan members save and invest for retirement.
Confidence versus literacy
Sun Life measured both objective financial literacy through a 10‑question quiz and self‑assessed confidence.
The research identified four investor profiles:
- Sophisticated Investors
- Overconfident Investors
- Cautious Experts
- Cautious Investors
According to Sun Life, members with high confidence save 64 percent more relative to income than low‑confidence members.
Higher literacy alone corresponds to a 12 percent savings advantage.
Sophisticated Investors, who combine high confidence and high literacy, hold savings equal to 3.9 times household income.
Cautious Experts, who have similar knowledge but low confidence, hold 2.1 times income, creating the 86 percent gap Sun Life highlights.
“An 86 percent difference in savings is staggering,” said Dave Jones, senior vice-president, Group Retirement Services, Sun Life.
He called it “a wake-up call” and said Canadians need more than education to build the confidence to take control of their financial futures.
Workplace plans as a core pillar
Sun Life reports that surveyed members say their workplace plans hold, on average, 36 percent of their total investable assets, and 52 percent count those plans as a main source of retirement income.
The same report shows a perception gap on balances.
Survey respondents estimated an average of $159,000 in their Sun Life workplace plans, while actual balances average $136,000, a 14 percent or $23,000 difference.
Sun Life notes that men overestimate more (16 percent) than women (12 percent).
Gender gaps in savings and confidence
As per Sun Life’s Designed for Savings research, women contribute 21 percent less than men to group retirement plans and retire with lower average balances: $164,000 for women versus $224,000 for men.
Citing Statistics Canada, the report notes that a Canadian man retiring at 65 will live to about 84 on average, while a woman will live to about 87.
Sun Life adds that women spend 24 percent more time in poor health than men and face greater exposure to age‑related disease and disability.
According to Sun Life, women are more concentrated in the low‑confidence profiles (Cautious Experts and Cautious Investors), while men are more often Sophisticated or Overconfident Investors.
Men gravitate more to diverse, growth‑oriented strategies and digital tools.
Women place more emphasis on stability, long‑term security and personalised guidance.
The advice gap follows the same lines.
Sun Life reports that when men avoid advisors, 57 percent cite self‑reliance.
Among women who do not see advisors, 45 percent give the same reason, while 27 percent say they have too little in savings or assets to seek advice, compared with 21 percent of men.
What members say they want from plans
The report highlights a clear appetite for advice and simpler plan structures.
According to Sun Life:
- 77 percent of surveyed members say personalised and professional guidance in group plans is important.
- 70 percent want access to financial advisors for holistic retirement planning, including tax and estate planning.
- 62 percent want regular check‑ins with an advisor, such as every six months.
On delivery, 71 percent prefer email for retirement planning information, and smaller proportions choose webinars, in‑person meetings, mobile apps, online articles, virtual meetings or advisor phone calls.
Plan design findings include:
- Among members who understand their employer match, 90 percent contribute enough to receive the full match.
- Nearly 80 percent value automatic features such as auto‑enrolment and auto‑escalation.
- Many members describe the complexity of RRSPs, TFSAs, DCPPs and DPSPs as “neutral,” which Sun Life treats as a signal that clearer explanations could help.
By gender, Sun Life reports that 82 percent of women versus 77 percent of men favour smart automation and “set‑it‑and‑forget‑it” features, and 71 percent of women versus 63 percent of men favour automatic contribution increases as retirement approaches.
At the same time, 38 percent of women versus 27 percent of men say they have only a general idea of their DC pension match and do not know the exact amount needed to maximise it.
