Families covered by registered pension plans (RPPs) are also more likely to have RRSPs than families without workplace pensions, even when controlling for factors such as income, suggests a new study.

The study from Statistics Canada, Employer pensions and the wealth of Canadian families, finds that families with RPPs accumulate more wealth than those without pensions, even when excluding those assets, and controlling for income.

The study found that, in 2012, the average wealth (the total value of assets minus the total value of debt) of families with RPP assets was $536,000, whereas the average wealth of families without RPP assets was $191,000. Excluding those pension assets, families with RPP assets had a median net worth of $210,600, compared with $64,000 for families without RPP assets.

Additionally, the study found that families with RPP assets were also more likely to hold other types of assets. For example, 79% of those with RPPs also had RRSPs/LIRAs, compared with 55% of those without pensions. They were also more likely to have real estate equity.

Some, but not all, of the difference between these two types of families is attributable to socioeconomic characteristics, the study says. For instance, families with RPP assets were more likely to have higher after-tax incomes, to have a university degree, and to have longer job tenure than families without RPP assets. It finds that these differences accounted for approximately half of the difference in average wealth between families with and without RPP assets, and for about 40% of the difference in median net worth.

The study estimates that families with no RPP assets would have an average wealth of $359,000 if they had the same socioeconomic characteristics as families with RPP assets. Therefore, controlling for those characteristics, families with RPPs would still have greater average wealth of $177,000 than those without RPPs. And, even controlling for income, families with RPPs were still more likely to hold investments than families without workplace pensions (by a margin of eight percentage points).

“Whether this finding reflects the causal impact of workplace pension plans on wealth accumulation or intrinsically different savings behaviour from RPP members and non-members remains to be determined,” the study concludes. “Nevertheless, this finding informs discussions regarding how changes in the availability of workplace pensions, both in Canada and internationally, may impact private wealth accumulation.”