Ramping up retirement: 5 ways to increase employee participation and contributions

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Employers face many challenges when it comes to benefit plans. The first hurdle is raising employee awareness of their benefits. The second is encouraging employees to opt into retirement plan contributions. The next big question is how to get them interested in managing their retirement investments – or at least giving them some attention.

If the firm has a defined contribution plan, employees are at the door and opportunity is knocking. 68% of private sector employees have access to a plan yet only 51% take advantage. One of the major reasons is they perceive their after-tax take-home pay shrinks because of all the deductions like taxes, Social Security and health insurance. Contributing to a company retirement plan seems to shrink it further, so they opt out. The strategy employers and the benefit plan professionals supporting them often deploy is raising their awareness of how the company is providing a match, so opting out is leaving money on the table.