Millennials may be overly confident about their investingskills, but many are handling their 401(k)s with savvy,a new study (pdf) by Wells FargoInstitutional Retirement & Trust suggests.

Related: Millennials want financialhand-holding

More than a quarter of younger workers — 28 percent — have at least10 percent deducted from their paychecks, according to thestudy. It analyzed the behavior of 4 million employees inthe plans the company administers, from 2011 to 2016. Among theolder generations, 35 percent of Gen X-ers and 44 percent ofboomers were at the 10 percent contribution mark.

Boomers get their own shout-out. If you assume they are theones earning $100,000 or more, which they likelyare, they are the "most improved" group over the study'sfive years among those who contribute at least 10 percent.There was a 15.3 percent increase among those making $100,000or more hitting the 10 percent rate.

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At the same time, there is a lost opportunity for boomers.Just 7.7 percent of participants 50 and older make the additional$6,000 "catch-up contributions" allowed by the IRS.

Efforts to get employees to start saving earlier and awidespread trend to auto-enroll employees in retirement planshave helped put more people of all ages in the most populardefault investments, target-date funds.

These funds are widely diversified and automatically adjustasset allocations between stocks, bonds, and other assetsbased on a person's age, leading up to a more conservativeportfolio at retirement.

The survey found that 85 percent of millennials use a managedinvestment such as a target-date fund, compared with 77percent of Gen X-ers and 73 percent of boomers.

Related: Retirees to millennials: Saveyourselves

"We're seeing the first generation that had thefull, out-of-the-gate use of tools like auto-enrollment andtarget-date funds, and it's really getting people into plansearly and getting them diversified," said Joseph Ready, headof Wells Fargo Institutional Retirement & Trust. "Whetherthey're astute about the market or not, these things will helppeople take advantage of, hopefully, longer-term returns from theequity market over the next 35 to 40 years."

When younger savers do fiddle with their 401(k) accounts,some of them are making smart tax moves. Sixteen percent ofmillennials elected to use a Roth 401(k), compared with 12 percentacross all generations.

Contributions that go into a Roth are after-tax, so starting onewhen you're young and in a low tax bracket is a goodstrategy.

For all that, there's room for improvement among millennials. If 28percent are deferring at least 10 percent of their pay, seven outof 10 aren't.

Employers can help by automatically escalatingemployee contributions each year and doing so at a higherrate. Employers have been concerned about being too aggressivewith this strategy, and those that do it typically increase thecontribution rate by 1 percent annually.

Wells Fargo's Ready urges employers that use auto escalationto bump employees up by 2 percent a year to get them up to that 10percent savings goal faster. Wells Fargo data show that ifemployers bump the auto-increase rate from 1 percent to 2 percent,there's no big difference in the rate of employees who opt out ofthe increase.

And it makes a huge difference in how prepared they are toretire, Ready said. Employees can take matters into their ownhands, of course. Every time a raise or a promotion comes along,make it a point to increase your savings rate, whether through your401(k) or in a separate savings account. That use of today'srewards will yield a far more meaningful return tomorrow.

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