Matching contributions to an employer-sponsored retirement plan (ESRP) can more than double the savings of the average plan participant.

That’s according to a new study from Hearts & Wallets. “Retirement Income Programs and Employer-Sponsored Retirement Plan Engagement” found that on their own, plan participants just aren’t doing all that well in putting away money for retirement.

Although average annual household savings increased over the past year from 4.6 percent in 2013 to 5.5 percent in 2014, average household savings that went into ESRPs fell 7 percentage points over that same year, going from 29 percent in 2013 to 22 percent in 2014.

Eligible and participating households fell from 60 percent in 2013 to 56 percent in 2014.

Because not all ESRPs offer matching funds, the effect of such matches aren’t quite as readily quantified as other influences.

However, Hearts & Wallets found that, while the average saver will manage to save $1,200, the effect of a matching employer contribution can act as super motivation.

Read: Retirement bills would allow higher matches

People who care a lot about taking the maximum advantage of employer matching funds will more than double their savings, from $1,400 to $2,600.

Middle-income savers who are on the receiving end of a match manage to save the most. It motivates them to sock away 2.5 times as much as they would without the employer kicking in.

That kind of help is great, but it’s not the whole answer, the study said. It also found that older investors need help in managing their retirement resources—and that need is up 27 percent in two years.

Read: Millennials aren't meeting their match (in 401(k)s)

More than a third (33–42 percent) of older Americans, according to the study, want services that execute a retirement income program, monitor progress, and minimize taxes and income across multiple accounts. And they’re not getting it.

The single element of those services most in demand is the part that makes recommendations for minimizing taxes.

And the demand for it is greatest at employer-based providers/“stores,” Hearts & Wallet’s term for retail and defined contribution providers that work directly with investors.

Instant Insights /

Employer matches can motivate retirement plan saving

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