Employers who offer 401(k) matches do so to benefit their employees – but it’s a benefit many employees aren’t taking advantage of. Americans may be missing about $24 billion each year in company matches to their retirement accounts, according to a new Financial Engines study. “The typical employee who fails to receive the full match leaves $1,336 of potential ’free money’ on the table each year,” the study found. “For the average employee, that’s an extra 2.4 percent of missed annual income.”


This gap especially seems to be generational, the study found. “For example, 42 percent of plan participants earning less than $40,000 per year do not take full advantage of their employer match,” it found. “That compares to just 10 percent of employees who earn more than $100,000 annually. Likewise, employees under age 30 are approximately twice as likely to miss out on their employer match compared to employees over the age of 60.”


Generation X workers may be focused on expenses related to raising families, or may be paying on large loans, Nick Otto writes for Employee Benefit News. Millennials may be more risk-averse than other generations when it comes to investing for retirement, according to Kenneth Corbin’s Employee Benefit News report of a panel at the Investment Company Institute’s general meeting. “The approach to take with the younger generation and the mid-career professionals is quite different,” said panelist Kara Hoogensen, managing director of product development at Principal Funds. She believes one key is encouraging young workers to save. Another: creating policies that provide automatic retirement contributions so Millennials can easily participate in employer-matching programs.


Brokers can help their clients encourage employees to take advantage of matches in several ways, Andrea Davis writes for Employee Benefit News. These tactics could include advice about providing “extra reminders about the match, defaulting plan participants at a higher savings rate, offering investment advisory services, auto-escalating employees’ savings rates and reworking the match formula,” Davis writes.“The most common way we’re seeing most employers make sure individuals are receiving the full company match is communicating to participants,” Davis writes, quoting Rob Austin, director of retirement research at consulting firm Aon Hewitt. “ (They’re alerting) them when they’re… leaving money on the table.”


Access to financial professionals can also help, the Financial Engines study found. “Employees across all ages and income levels who used advisory services were less likely to miss out on any of their employer match compared to those not receiving this help,” the study found. “For example, 25 percent of employees who earn less than $40,000 and who use professional advisory services missed out on part of their employer match, compared to 44 percent of people who did not use advisory services.”