Readings from the Capital Accumulation Plan income tracker (CAPit) from consulting firm Eckler, are beginning to be impacted by the tariff chaos underway since United States President Donald Trump’s inauguration. The firm says driven by negative equity market returns under the new global levies, a male member retiring at the end of March 2025 achieved a gross income replacement ratio of 63.8 per cent, down from 66.5 per cent in December 2024. A female member achieved 62.2 per cent, down from 64.8 per cent during the same period.
The CAPit measure assumes the representative member made annual contributions at a rate of 10 per cent, starting at age 40, will use their CAP account balance at retirement to buy an annuity and will receive maximum public pension plan payments. They say the representative salary is adjusted annually in line with the average industrial wage. It sits at $73,777 as of Dec. 31, 2024.
“President Trump’s inauguration and subsequent tariffs had a significant impact on CAP member outcomes by March 31,” Ecker’s researchers write. To help, they urge employers to focus on financial wellness support for employees. “One of the most effective ways to reduce anxiety and help Canadians stay on track with their financial and retirement goals is by encouraging employees to have a financial plan,” they add. “Providing your employees with financial planning tools can help alleviate the stress of the current situation.”
