Corporate Employees Missing out on $24 Billion!

Employees missing out on $24B in employer matches

Over the past decade, employers have increased efforts to enroll workers in retirement savings plans. And they've paid off. 

Participation rates are at all-time highs with nearly 8 in 10 employees taking advantage of defined contribution plans like 401(k)s when they have access to them, according to estimates by Aon Hewitt. 

Persuading workers to max out their savings in those plans, though, has been tougher. 

By 2013, the "vast majority [of employers] offered some type of employer-matching contribution" to encourage workers to save more, according to a recent Aon Hewitt analysis of nearly 150 plans with 3.5 million eligible employees. But even when employers offer matches, employees don't always take advantage of them. 

A new report released Tuesday by the independent investment advisory firm Financial Engines found that 1 in 4 employees is missing out on receiving the full company match by not saving enough—leaving an average of $1,336 on the table each year. Or an estimated $24 billion altogether. 

"The match is one of the best deals employer plans offer," said Greg Stein, director of financial technology at Financial Engines, which examined the savings records of 4.4 million retirement plan participants at 553 companies. "It's an instant return on the retirement plan and demonstrates why it's so important to communicate the benefit of participating fully, and how much money is at stake."