Are Our Pensions Doing, Okay?

 Lately, more than a few retirees have been asking: “How are our pensions doing?” or “Is the Canada Pension Plan still secure?” These are fair questions, especially in uncertain economic times when the news seems full of mixed messages about markets, inflation, and government budgets.

Let’s take a closer look at the facts, and why there’s good reason to feel confident about the pensions that so many Canadians depend on. 

A word of caution, I am not a financial planner or an expert in finance, these are my thoughts based on some research and life experience. Take my views with a grain of salt, and do your own research, and talk to your own financial advisor  before you make any changes or moves.

The Big Picture: Pension Plans Are Holding Their Ground

Despite market ups and downs, the majority of Canadian pension plans,  both public and private,  appear to be performing steadily and remain financially sound.

According to Northern Trust Canada, the median Canadian defined-benefit pension plan earned a 3.6% return in the third quarter of 2025, and 4.3% year-to-date through September 30. Another major tracker, RBC Investor Services, reported even stronger results for its universe of pension plans: a 4.4% gain in the third quarter and 7.1% year-to-date.

The difference between the two sets of figures simply reflects the different groups of plans each company monitors. But what’s most important is that both show solid positive growth, and that’s reassuring.

These returns come after a challenging period in 2022 and early 2023, when inflation and rising interest rates caused turbulence in investment markets. Pension funds, however, are designed to ride out these waves. They are diversified across stocks, bonds, real estate, infrastructure, and private investments. This diversification cushions the impact of short-term volatility.

Public vs. Private Plans: Both Are Stable

Many Canadians participate in large public sector plans, like those for teachers, nurses, municipal employees, and other government workers ,  while others have corporate or private employer plans. Both types are proving resilient.

Data from BNY Mellon’s Canadian Asset Strategy View shows that public plans and private (corporate) plans have been trading places in terms of quarterly performance, sometimes one leads, sometimes the other. In recent quarters, both have posted consistent positive results.

Public pension plans such as the Ontario Teachers’ Pension Plan, OMERS, and HOOPP (Healthcare of Ontario Pension Plan) continue to report healthy funding ratios and strong governance practices. These large funds are among the most respected in the world for how they manage risk and long-term growth.

Private or corporate pension plans, meanwhile, are benefiting from improved interest rates, which have reduced their long-term liabilities,   meaning they’re in better shape to meet future obligations to retirees.

In simple terms: whether your pension is public or private, it’s being managed with care and is built to last.

Why Pension Plans Are Built for the Long Game

Pension funds don’t make investment decisions based on daily market headlines. They plan for decades ahead. Most have professional investment managers, oversight committees, and strict funding requirements set by provincial and federal regulators.

When the markets go through a rough patch, plans don’t panic-sell. Instead, they often rebalance, buying more of what’s undervalued and selling what’s overheated. Over time, this disciplined approach pays off.

Another key point: pension plans benefit from what’s called “pooled longevity risk.” That means because they serve large groups of members, the plans can better predict how long benefits will be paid and adjust accordingly. This stability is something individual investors can’t easily replicate on their own.

The Canada Pension Plan: Still One of the Strongest in the World

Alongside workplace pensions, almost every Canadian is entitled to the Canada Pension Plan (CPP). Despite some recent rumours and political chatter, the CPP remains one of the most stable and well-funded national pension systems in the world.

The Canada Pension Plan Investment Board (CPPIB) manages the fund independently from government, using professional investment strategies that diversify globally. As of mid-2025, it had over $650 billion in assets, and long-term actuarial reports continue to confirm that the CPP is sustainable for at least the next 75 years under current contribution and benefit levels.

So, if someone tells you “the CPP is running out of money,” you can safely say that’s simply not true.

What This Means for You

If you’re retired, or soon to be, it’s natural to feel uneasy when you hear about inflation, interest rates, or market swings. But the reality is that Canada’s pension system is doing what it was designed to do: provide steady, reliable income for life.

Of course, it’s still wise to keep an eye on your personal finances ,  maintain a mix of savings, watch your spending, and stay informed. But there’s no need to lose sleep about your pension plan suddenly collapsing or being “in trouble.” The evidence shows that pensions are performing well, funding levels are strong, and oversight remains rigorous.

In Summary

• Most Canadian pension plans are stable and showing positive returns in 2025.
• Public and private plans alike are well-managed and built to weather economic cycles.
• The Canada Pension Plan remains financially sound and sustainable for decades to come.

If you’ve worked hard your whole life, you deserve peace of mind in retirement and Canada’s pension framework is doing its part to provide that.