Man Holding Two Coin Stacks To Compare
Although employer matches may be intended to incentivize workers to contribute to companies' 401(k) plans, most of the evidence suggests that they have only a small effect on participation and saving, according to a new Vanguard survey, "Are employers optimizing their 401(k) match?"
The research, which was collected from more than 1,300 employer-sponsored retirement plans, finds that, while employer contributions are an important component of total savings, employee savings rates vary surprisingly little across plans with different matches. The study found that just 13% of employees save at exactly the match cap.
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