How Employers Can Help Solve the Retirement Savings Problem

Matching Contributions. Three-quartersof survey respondents favored a mandate requiring employer matching contributions, and 60% said there should be a mandate requiring individuals to sign up for a company retirement plan. In the U.K. employee an auto-enrollment requirement increasedparticipation rates in company retirement plans. Almost half of those respondents who didn't participate in an employer-based retirement plan cited the lack of a matching participation.

Education. "Workers need education and advice if they are going to navigate the complex choices they face in funding retirement," according to the survey. Such education "needs to go beyond basic lessons in diversification, allocation and compounding if workers are to become more engaged in retirement." In addition, offering investments that comply with workers' values such as ESG strategies can be helpful especially with millennials, according to the survey.

Professional Advice. The survey found that employees who work with professional advisors saved substantially more for retirement: $239,000 versus $121,000 for those working with an automated advisor and $196,000 for those who were self-directed investors. What's surprising about these results is the effectiveness of the self-directed investor compared to the investor using a robo-advisor but the numbers may be too small to generalize from since only 30% of respondents reported working with a financial advisor, while 57% were self-directed and only 7% worked with a robo-advisor.

Tailored Approaches. The survey found several reasons for employees not participating in their work-based retirement plans and some can be linked to their particular generation. For example, many millennial respondents noted that student loans were an obstacle to saving for retirement while many of their parents – baby boomers and Gen Xers – cited saving for college – as an impediment.The report suggested that if employers offered student loan forgiveness and higher education savings plans some of their employees could save more for retirement.

One crucial finding of the survey, which has been found in other surveys, is the financial discipline of millennials. They have started participating in their company'sretirement plan at age 23, four to eight years earlier than Gen X and boomers and more than half expect to increase their contributions annually or are already contributing maximum amount to their retirement plans.

— Related on ThinkAdvisor:

• 30 Best Big 401(k) Plans: BrightScope
• How Millennial Women, Men View Retirement Differently: Schwab
• Are Your Clients' 401(k)s 'True Up' Plans?
• Senate Finance Lawmakers Introduce Retirement Bill