Small business employees in the United States are at a disadvantage when it comes to retirement savings, according to a Transamerica survey.

When compared to employees at large companies, small business employees are less likely to have access to a defined contribution plan or employee-funded retirement plan. They are also less active then their large company counterparts in saving for a comfortable retirement.

Only 18% of small business employees reported having saved US$100,000 or more in all household retirement accounts, while 29% of employees at large companies reported having saved that much.

One major reason for this gap has to do with access to a retirement plan. Data from the survey found that only 65% of small business employees report being offered an employee-funded retirement plan, compared to 84% of employees at large companies.

Meanwhile, 20% of small business employees reported not receiving any form of retirement benefit from their employer. Furthermore, among those with access to a plan, only 69% of small business employees reported being offered an employer matching contribution, while 86% of large company employees are offered one.

However, employers are not entirely to blame. When offered a plan, small business employees are less likely than employees of large companies to participate or have money invested in the company’s plan(70% vs. 76%), while also contributing a slightly lower percentage of their salary(based on median). Small business employees are also less likely to be saving outside of work(52%, compared to 61% of large company employees).

The survey also shows it is unlikely this current situation will change. Seventy-three percent of small businesses that don’t currently offer a retirement plan indicated that they weren’t likely to in the near future.

“Not enough is being done to help small business employees prepare for a comfortable and secure retirement,” says Catherine Collinson, retirement and market trends expert for the Transamerica Center for Retirement Studies. “Lower savings rates ultimately lead to a reliance on the future of Social Security, which underscores the need for a wake-up call among employers and employees alike.” .

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