Employees do not save enough for their eventual retirement needs, research shows. But, with tools, help and education from financial advisers that paradigm may shift - benefiting not only the employee but the employer and adviser.

According to a recent survey by ING, 87% of Americans say they could be saving more for their employer-sponsored retirement plan, which 64% of all 1,000 respondents claim accounts for all or most of their retirement portfolio.

Competing priorities

Retirement is not the top priority of many Americans, explains Amy Vaillancourt, senior vice president of inside sales and service at Windsor, Conn.-based ING U.S. Retirement.

"Americans have a lot of competing priorities when it comes to how they choose to spend and save their money," she says. "Americans are not really trained or educated in their lifetimes about saving and investing for retirement. . . . Research shows people don't understand [the] basic concept of how a little now adds up to a lot in the future."

Common practice says to save 15% from the time you are 20 years old, and for many people that is lot of money, says Girish Menezes, principal in the London, England office of Buck Consultants.

"Figuring out how much you need to save is huge and daunting . . . that in itself is a huge barrier," he says. "We as [a] society haven't helped the individual think about what they need to [save] earlier in their lifetime" to make a difference in retirement.

The bottom line is there are just too many competing priorities, and since retirement is an issue many years from now for a good portion of the workforce it is at the bottom of the list.

"Most of society won't think about compound interest and how to save, so they fall into fables. 'I might not die tomorrow or I'll work until I die,'" says Menezes. "[I'm] not sure anybody believes that, but it's easier to believe that then to say, 'Actually, I'm not going to buy that color television, I'm not going to go on [vacation.]'"

A new trend

While the issue of employees not saving enough for retirement is not a new one, there is even less money being saved as a result of the shift from employer-spocnsored plans to employee-sponsored.

In the past, people knew their employer was providing them a pension that would carry their retirement, Vaillancourt says. Now, they don't have that automatic contribution or match.

Additionally, on average consumers lost 40% of their 401(k) balances between 2007 and 2010, and of those close to retirement, only 75% gained back their balance to the pre-financial crisis level, says Anne Arvia, president of retirement plans at Nationwide in Columbus, Ohio.

Overcoming the apathy

To overcome the apathy that many employees have toward saving for their retirement, Menezes recommends having advisers, brokers and companies deliver their message like a journalist, not an administrator.

"When journalists write pieces, they write it so a person can look at the headline and say, 'Wow, that looks interesting,'" he says. "When somebody reads [a retirement document] you want them to say, 'Wow, I learned something today.'"

Americans actually understand the topics and if it is not written by "completely boring" lawyers and instead uses an eye-catching headline and a graph with pictures, people will understand saving for retirement as they already get the concepts, just not in retirement terms, Menezes says.

"They follow the Super Bowl, the stock market, gambling. . . . They do some really complex calculations about what numbers they should bet on in the lottery," he adds. "These people do complex math but we are not helping them do the complex math to do compound interest and if they put a little money in every week, they can look at themselves in old age."

It also comes down to education between plan planners and advisers, Vaillancourt says.

Nearly 80% of respondents to an ING survey say they trust their financial planner and company for information on retirement savings (see chart). But that education needs to be relevant to each age group, Vaillancourt adds, as a 20 year old will be thinking differently about retirement than someone twice or three times his age.

Another way to reach out to employees

Part of the education may include videos. Clair Diones, the director of marketing for Denver-based National Endowment for Financial Education, recalls an example from Dartmouth College where videos were created to show the benefits of starting to save early.

"They created these videos that ended up increasing participation by 56%," she says. After watching the videos, the employees of Dartmouth were interviewed and said that they saw people just like them and said, "Oh, maybe people like me really do save."

But Diones acknowledges creating those videos takes time, and HR managers are already balancing a lot of different tasks.

"Financial education, 401(k) enrollment has not been a priority for them," she says.

Broker's opportunity

Helping clients understand retirement and in return save more money could potentially mean earning more commissions for brokers.

"The more money [a client] puts into a pension, the more they have under management," Menezes says.

It also encourages advisers to work hand-in-hand with the retirement providers. It's a team effort, ING's Vaillancourt says.

"We do understand the value that advisers bring and our ability to work directly with employees or very closely with advisers to make sure everyone along the [retirement] chain is trying to get to that retirement outcome," he says.

Even in today's technology-driven, do-it-yourself environment, "people do listen to a trusted adviser," adds Arvia. "Personalized advice has become a significant way that we are starting to approach our customers and most efficiently provide it for that."

In the end it will come down to the work of advisers and their client companies to help those clients' employees save more. The ING survey found that employees certainly aren't counting on Social Security to help them in the future. In the survey, 51% of respondents think its more likely scientists will clone dinosaurs in their lifetime than Congress will save Social Security.

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