Workers misinformed about 401(k) contribution limits

“This leads to a compelling and troubling arithmetic,” the report states. “Do participants under 50 really believe that they are contributing at about 88 percent the tax-deferred max as [the above] responses indicate—when in fact their deferrals on average are about 43 percent of the max? And does the 50 and over crowd really think they are deferring at 81 percent of the max when their reality is barely 29 percent. How much tax efficiency are they leaving on the table, knowingly or unknowingly?”

The survey reveals that more than three quarters (77 percent) of employees expect economic growth in the year ahead, up four points from 2012 and matching the post-recession optimism recorded in 2010. The proportion of respondents expecting a recession dipped to 23 percent.

Fewer workers this year (40 percent of 401(k) plan participants) are considering delaying their retirement beyond their original target date. This compares 44 percent in June 2012 and 42 percent in July 2011.

Over the same period, job security, as measured by the share of workers concerned about losing their jobs over the next 12 months, edged up two points. Workers over age 50, the report notes, feel more secure than those under age 50.