You set up the group retirement plan years ago. It was a good decision. People enrolled, the match comes off payroll every period, and nothing has gone wrong since.
So it never comes up. There is no invoice to question, no renewal letter with a number that jumps, no vendor asking you to re-sign. The plan just sits there, working, as far as anyone can tell.
That quiet is the problem. The fee on your plan is being paid every year by your employees, out of their own accounts, and almost nothing in the normal course of business will ever put it in front of you.
What is a reasonable fee for a Canadian group retirement plan? Published rates on plans sold to small and mid-size Canadian employers commonly run 1.75 to 1.95 percent a year, before fund operating expenses and sales tax. Plans in the low 1 percent range and under exist and are available to employers of the same size. The gap is paid by employees, not the company.
Why doesn't the fee show up anywhere you would look?
Because you are not the one paying it.
On most group retirement plans the fee is deducted from employee account balances. It never appears in your payroll register, never lands on an accounts payable list, and never triggers an approval. Your finance team can run a clean set of books for a decade and never see it.
That is why a high fee can sit in a plan for years without anyone acting on it. Not because anyone was careless. Because the ordinary systems a business uses to catch costs are all pointed at money leaving the company, and this money is leaving somewhere else.
The people paying it are the least equipped to notice. An employee sees a balance that went up. Whether it went up as much as it should have is not a question most people have the information to ask.
What changed in September 2024?
Canada's pension regulators updated their Guideline for Capital Accumulation Plans in September 2024, the first revision since 2004. Twenty years is a long time in this area, and the update reflects how much of Canadian workplace saving has shifted into group RRSPs and similar arrangements.
Two parts matter for an employer with an existing plan.
Sponsors are expected to establish and document a governance framework. That means being able to show how the plan is overseen, in writing. The expectation now extends to group RRSPs, where it previously sat mainly with registered pension plans.
Sponsors are expected to periodically review member-borne fees and expenses for reasonability and competitiveness. That is close to the guideline's own language, and it is the sentence most existing plans fail against, because for many the honest answer is that no one has looked since the plan was set up.
The regulators recognized some of this takes time. Where process or system changes were needed, the expectation was that they be in place by January 1, 2026.
That date has passed.
Is this a legal requirement?
No, and it is worth being precise about it, because you will hear it framed both ways.
This is guidance, not legislation. The regulators who issued it have no enforcement powers here, and group RRSPs are governed by the Income Tax Act rather than pension standards legislation. No one is going to send you a notice.
What it does is set the expectation of what reasonable oversight looks like. If a question is ever raised about how your plan has been managed, the standard it gets measured against is the one written down, whether or not anyone was enforcing it. And the practical version matters more than the regulatory one: your employees are paying a fee you have not checked.
What does the gap actually cost the people in it?
Fees on retirement accounts do not stay the size they start at. They compound against a balance that is also compounding, every year, for as long as someone is in the plan.
Take a plan with 150 employees and average account balances around $45,000, held over 20 years. The difference between a fee approaching 2 percent and one under 1 percent works out to roughly $1.6 million left in employee accounts rather than taken out of them (illustrative).
That is not a rounding difference. Spread across 150 people it is a meaningful piece of what they retire on, and it was decided by a plan document no one revisited.
Put your own numbers in and see it. We built a calculator that takes your headcount, your average account balance and the fee your employees currently pay, and shows what the gap comes to over 10, 20 or 30 years: riskx.ca/group-retirement/existing-plan-review. It takes about a minute, and you do not have to talk to anyone to use it.
The result is usually larger than people expect, because the fee applies to the whole balance every year, not to the contributions made that year. A plan that has been running for fifteen years has been charging against fifteen years of accumulated savings, not against last year's deposits.
Why doesn't every plan already run at the lower number?
Because nothing in the arrangement creates pressure to move it.
The provider has no reason to raise it. The fee is disclosed somewhere in the plan documents, which satisfies the obligation, and a plan that never gets reviewed is a plan that keeps paying what it started at.
The advisor who set it up has a reason not to look. Their compensation usually comes out of that same fee, so a review that lowers it lowers their own pay. Very few people go looking for that conversation on their own, and almost no plan has a scheduled review written into the relationship to force it.
And you have had no reason to ask. Nothing broke. That is the whole mechanism. A cost that is invisible to the person with the authority to change it, sitting inside a product that works well enough that no one investigates.
None of this requires bad behaviour from anyone. It only requires a cost that no one in the arrangement is paid to question, sitting inside a plan that works well enough that no one asks. You deserve to know what yours is.
What happens if you leave it another year?
The fee runs for another year, against a balance that is larger than last year's, for every person in the plan.
There is no event that forces the question. No renewal, no notice, no expiry. A plan can run for a decade on autopilot precisely because nothing in it is designed to interrupt you. The cost of doing nothing is real. It just does not show up on a single renewal letter. It shows up when you model it forward.
The other cost is the one you cannot get back. Every year the gap runs is a year of compounding your employees do not get to redo later, even if you fix the fee afterward.
How RiskX approaches it
We review the plan you already have, in writing, whether or not you move it.
That means pulling your investment options and fee schedule, confirming whether the figures include fund operating expenses and sales tax, comparing your all-in fee against comparable Canadian plans on the same basis, and looking at what the fee actually buys in terms of investment lineup, employee education, advice access, and administration. Then you get the findings and the date, so there is a documented review on file regardless of what you decide.
The gap we are usually closing is the one described above. Published rates in the small and mid-size market commonly sit between 1.75 and 1.95 percent. The plans we place come in under 1 percent all-in, which is roughly half. Same size of employer, same kind of plan, and licensed advisor access at no cost to employees on top of it.
That difference does not come back to the company. It stays in the accounts of the people who work for you, compounding, for as long as they are in the plan. It is one of the few things an employer can change that costs the business nothing and is worth real money to every single person on the plan.
We are compensated by the carriers and providers we work with, and we disclose that in writing every year, because you should be able to see who pays us before you weigh what we tell you.
Sometimes the answer is that your plan is fine. That is a useful thing to have in writing too.
What should you ask your current provider?
Four questions. You can ask all of them today, and none of them commit you to anything.
What is our all-in fee, and does that number include fund operating expenses and sales tax? The last part matters. Quoted fees often exclude both, which makes comparisons between plans meaningless unless you force them onto the same basis.
Who pays it? If the answer is that it comes out of employee accounts, ask what it worked out to in dollars last year across the plan.
When was it last reviewed, and by whom? If no one can name a date, that is your answer.
What would we pay if we set this plan up today? Pricing for plans your size has moved. Existing plans do not reprice on their own.
If those questions come back thin, that is worth thirty minutes of someone's time. Your employees have been paying for the answer for years.
RiskX is a family-owned Canadian group benefits and group retirement brokerage, family-run for over three decades and licensed in Alberta and Ontario. The plans we place come in under 1 percent all-in, against published small-market rates of 1.75 to 1.95 percent. See what that gap is worth on your own plan: riskx.ca/group-retirement/existing-plan-review. We will review your existing plan's fees in writing, whether or not you move it. Book a call with Gordon Smith, Executive Chairman & Founder: https://ro.am/riskx-founder