A new study finds that 84% of Americans think the time has come for a new approach to workplace-provided retirement plans, including more automation of plans to cut down on struggles to make the right decisions on managing their programs.

Christine Marcks

Prudential’s sixth Workplace Report on Retirement Planning study “found that the losses sustained by American workers during the past two years really drove home the inherent limitations of longstanding retirement-plan design,” according to Christine Marcks, president of Prudential Retirement.

Marcks added that it is common knowledge that Americans aren’t saving enough for retirement and participation rates are not at a level to ensure retirement security for workers.

“Now, with the effects of the economic crisis still front-and-center in people’s mind, we’re seeing increased awareness of the importance of workplace-provided plans, and we’re witnessing increased concern and uncertainty from workers about their ability to make sound, appropriate, and informed decisions,” she said in a statement.

The result, Marcks said, is a “resounding call” to re-evaluate defined contribution plans, enhance current plan design and redefine retirement “in ways that help build long-term financial security for American workers.”

The mechanism to do that, according to survey participants, is fully automating defined contribution programs, incorporating “autopilot” plan features including automatic enrollment, automatic savings default rates and even automatic conversion of plan assets into a guaranteed retirement-income stream.

According to the survey, 74% showed a “positive” impression of automatic enrollment with automatic contribution rates and periodic contribution increases netting “positive” marks from 70% and 65% of respondents respectively.

Automatic asset-allocation was viewed as “positive” by 59% of workers ages 21 to 44 and by 57% of workers ages 45 to 64 and automatic conversion of assets to guaranteed retirement-income as “positive” by 71% of the younger group and 64% of the group of older workers.

About 61% of younger workers and 59% of older workers expressed a preference for a fully automated plan structure when given a choice between the auto-pilot approach and the common “do-it-yourself” model, according to Prudential.

“Today’s workers recognize the critical role played by their employment-based retirement plan and are keenly aware that the existing ‘do-it-yourself’ approach simply isn’t the best way to build or achieve retirement security,” said Marcks. “Importantly, workers seem comfortable giving up a level of ‘control’ if it might mean the potential for better outcomes over the long-term.”