When employees consider their future, most recognize the importance of retirement planning. However, year after year, many fail to adequately fund their retirement accounts, delay making contributions, or miss out on valuable employer matches. The reasons aren’t surprising: competing financial priorities, uncertainty about how much to save, or simply inertia during the enrollment process. Unfortunately, the consequences of these missed opportunities are significant for both employees and the organizations that support them.

Retirement savings are one of the clearest examples of how small choices today compound into massive financial differences over time. Consider an employee who delays saving $200 a month for just five years. By retirement, that decision could cost them well over $100,000 in lost growth. Similarly, an employee who contributes just shy of the full employer match is leaving free money on the table, money their employer was willing to invest in their future.

So why does this happen? For many employees, the connection between paycheck decisions today and long-term retirement outcomes isn’t obvious. Contribution rates feel abstract, and without personalized guidance, it’s easy to choose a default percentage or stick with the same elections year after year. Without context, employees don’t see the true cost of undersaving until it’s too late.

Smarter benefits guidance makes the difference in this situation. Instead of presenting retirement savings as a one-off decision at enrollment, guidance shows employees the bigger picture: how their contributions affect take-home pay, how much “free money” they gain by capturing the full match, and how today’s choices can translate into retirement income decades down the line. By reframing savings in terms of tangible outcomes, such as monthly retirement income, lifetime growth, or tax savings, employees are more motivated to optimize their contributions.

For employers and brokers, the benefits extend beyond the individual. A workforce with stronger retirement readiness is more financially confident, less stressed, and better prepared to transition out of the workforce on time. That reduces long-term workforce costs, lowers turnover risk, and enhances the overall perception of the benefits program. Employers also experience higher employee satisfaction when employees fully understand the value of the retirement benefits they are offered.

The message is simple: failing to optimize retirement contributions is one of the costliest mistakes employees can make, but it’s also one of the easiest to fix with the right guidance. By helping employees understand the impact of each contribution decision, employers and brokers can transform passive enrollment into proactive planning, resulting in stronger retirements, happier employees, and a healthier bottom line.

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