Most DC plan participants receive matching contributions

Forty percent of the employees who are not currently contributing enough to get the maximum matching funds from their employers said they get reminders to do so and are happy to receive them. An additional 32 percent do not receive reminders from their employer but said they wish they did.

"An employer match is a very compelling factor in determining whether employees contribute to a defined-contribution retirement plan, but just offering it is not enough," Hassara says. "Plan sponsors must ensure they are communicating the benefits of the match to employees, particularly those who are not currently reaching the full match. Their communications should be targeted to various groups' unique financial needs."

For low earners, for example, plan sponsors can explain the inherent benefits of saving for retirement and position the matching contribution as part of a larger focus on long-term financial well-being. For women, more information about the match may be effective. Of those not receiving the full match, 17 percent of women (compared to 10 percent of men) said that more information about how the match works would make them consider increasing contributions.

TIAA-CREF asked survey respondents how much they would earn from a 3 percent employer match. In the example, the match would be worth $72,518 by the time they were 65. However, one-third (32 percent) of respondents thought it would be worth less than $50,000.

Women, Gen Y respondents and those earning less than $35,000 a year were even more likely to underestimate how much the employer contributions will translate into.