Get access to the exclusive HR Resources you need to succeed in 2018.
Sign up for free email newsletters and get more SHRM content delivered to your inbox.
Is your employee handbook keeping up with the changing world of work? With SHRM's Employee Handbook Builder get peace of mind that your handbook is up-to-date.
Build competencies, establish credibility and advance your career—while earning PDCs—at SHRM Seminars in 14 cities across the U.S. this fall.
Gain the skills you need to rise to the next level in your career. Jon us at SHRM's Leadership Development Forum, October 2-3 in Boston.
Employees overwhelmingly would refuse a job with no match, even with higher pay. But many over-rely on the match, failing to contribute enough on their own
Members may download one copy of our sample forms and templates for your personal use within your organization. Please note that all such forms and policies should be reviewed by your legal counsel for compliance with applicable law, and should be modified to suit your organization’s culture, industry, and practices. Neither members nor non-members may reproduce such samples in any other way (e.g., to republish in a book or use for a commercial purpose) without SHRM’s permission. To request permission for specific items, click on the “reuse permissions” button on the page where you find the item.
More than four out of 10 workers (43 percent) indicated that, if offered, they would prefer to have lower compensation in return for a higher employer contribution to their 401(k), according to new research.
Workers were more likely to accept a position if it had a company match as part of its overall compensation package. Only 13 percent indicated they would take a job with no company match, even if it came with a higher pay level, found a study based on 1,027 interviews with U.S. workers conducted in November 2013 by Fidelity Investments.
“Employer contributions play a vital role in helping Americans reach their retirement savings goals. These contributions represent more than 35 percent of the total contributions on average to an employee’s workplace savings account,” said Doug Fisher, senior vice president of Workplace Investing at Fidelity, commenting on the study report. “Fidelity recommends a total retirement saving rate between 10 and 15 percent of salary to ensure employees will have enough for retirement, but many working Americans will only reach that savings level if their 401(k) contributions are complemented with a company match.”
In a separate 401(k) survey, retirement plan provider TIAA-Cref found tha many workers who contribute to an employer-sponsored retirmeent plan:
“Considering that 44 percent of American employees save 10 percent or less of their annual income each year, these findings indicate that many employees have the opportunity to improve their retirement readiness by increasing their plan contributions regularly,” according to the firm, which sponsored a poll of more than 1,000 adults nationwide in May 2014.
“Plan sponsors should have ongoing interactions with employees over the course of their careers around three critical actions: enroll in the plan, increase contributions every year and check asset allocations every year to rebalance if necessary,” said Teresa Hassara, executive vice president of TIAA-CREF's Institutional Business, to
SHRM Online. “Auto-enrollment and auto-escalation options offer great benefit to overcoming employee inertia around retirement planning, but they are not universal, and they are not a substitute for employee engagement.”
Stephen Miller, CEBS, is an online editor/manager for SHRM. Follow him on Twitter
Message to Employees: Saving 1% More Will Boost Retirement Income,
SHRM Online Benefits, August 2013
How Match Thresholds and Default Rates Impact Savings,
SHRM Online Benefits, May 2013
401(k) Match: 'Thresholds' Drive Participation More than Rates,
SHRM Online Benefits, July 2012
Sweet Spot: Encourage Employees to Defer Adequate Pay to 401(k)s,
SHRM Online Benefits, May 2012
You have successfully saved this page as a bookmark.
Please confirm that you want to proceed with deleting bookmark.
You have successfully removed bookmark.
Please log in as a SHRM member before saving bookmarks.
Please sign in as a SHRM member before saving bookmarks.
Please purchase a SHRM membership before saving bookmarks.
An error has occurred
Recommended for you
CA Resources at Your Fingertips
SHRM’s HR Vendor Directory contains over 10,000 companies