
1. Decide between offering a retirement or savings plan

2. Revisit matching contribution threshold
Conventional wisdom suggests employees need to save around 15% of pay to retire at age 65 with adequate resources, according to Aon Hewitt. But many employer-match contribution formulas dont encourage employees to reach this target. Under a typical formula for an employer with only a defined contribution program, a plan provides 3% of pay as a non-elective contribution, with a matching contribution of 50% up to 6% of pay. Assuming the employee elects to contribute the default 6%, this produces total contributions of 12% of pay (6% employee + 3% non-elective + 3% match).
Think your employees cant afford to save more than 6% of pay? Research shows that many take their cue from the plan design on how much to save, and would thus increase their contributions. To encourage them to contribute more, consider a formula of 33% up to 9% of pay: this produces total contributions of 15% (9% employee + 3% non-elective + 3% match).
Matching a higher percentage of pay beyond 6% isn't a safe-harbor design for purposes of avoiding Average Contribution Percentage (ACP) testing. And some sponsors in low wage industries may believe its impracticable to raise the match threshold. But these concerns shouldn't end the discussion of considering the 15% savings target in future design/redesign discussions.

3. Focus on Designated Roth contributions

4. Use Health Savings Accounts as a retirement savings tool

5. Add projected retirement income estimates to participant statements

6. Streamline the number of investment options

7. Review Target-date fund glide path
