Sixty-five is the age most people think of when they hear the word, “retirement.” But 25 is the age that should really come to mind. That’s because planning for retirement requires a long-term strategy for savings.

With Americans burdened by a $4.3 trillion-dollar deficit in retirement savings, employers know that many employees, including those new to the workforce, need to do a better job of planning for retirement. Employers also know that they can play an important role in the financial literacy and savings behaviors of their employees.

Many U.S. employers have expanded benefits to include retirement savings and educational resources to assist with financial planning. Overall, 95 percent of employers offer a retirement savings plan for their employees.

In addition, employers are:

  • Matching traditional 401(k) contributions by as much as 76 percent. An employer match offers workers an incentive to save.

  • Offering financial advice for their employees either online, one-on-one and in a group or classroom setting. More organizations offer financial advice in each setting than 5 years ago. As a result, employees can take advantage of training at work instead of carving out time during nonwork hours.

Educational resources are invaluable and can provide employees with additional information to prepare for health care costs and other living expenses in retirement years.

Help for Younger Employees

A study by the Center for Retirement Research at Boston College found that college graduates with student loans accumulate just half as much in retirement savings by age 30 as graduates without debt.

According to financial planners, students who borrow for college could wind up poorer in the long run if they prioritize rapid debt repayment over saving for retirement.

There are 44 million Americans with student loan debt, bringing the total U.S. student debt burden to more than $1.5 trillion. An emerging effort is especially beneficial to the youngest group of employees — recent college graduates — as well as employees who go back to school.

A small but growing number of employers are providing student loan repayment benefits. This new benefit is in addition to undergraduate and graduate educational assistance offered by about one-half of employers.

More employers are interested in offering student loan repayment assistance. But an obstacle is the lack of a tax deduction for payments, which are taxable income for recipients.

Proposed legislation that would allow employers to provide loan repayment assistance with pretax dollars is now before Congress.

It’s never too early to begin saving for retirement. Employer-sponsored benefits help employees achieve financial stability and goals earlier in life.

Chatrane Birbal is director of congressional affairs for health and employee benefits policy at the Society for Human Resource Management (SHRM).