We've said it many times before: If your employer offers to match any portion of your 401(k) contributions, take full advantage. It's free money! It offers you an instant, generous, and guaranteed return (up to 100%). That should be hard to turn down, because it's certainly hard to beat.

The situation has changed a little, though. According to Sandra Block in USA Today, a new survey by Mercer Human Resource Consulting found that 36% of company retirement plans offered a 100% match in 2006, up from 26% in 2002.

There's a bittersweet angle to this development, though, because it's part of a bigger change in the American retirement landscape. Over the past few decades, more and more traditional pensions have gone the way of the saber-toothed tiger, replaced by "defined contribution" plans, such as 401(k) plans. Whereas before you were promised a "defined benefit" that guaranteed you a certain amount in your pension check, most of us now face uncertain future benefits. (Though with good planning, saving, and investing, these needn't be ugly benefits.)

Block offered as an example FedEx (NYSE:FDX), which is upping its match of employee contributions from 50% of the first $1,000 to 100% of contributions up to 1% of an employee's salary, plus 50% of contributions up to the next 5%. So whereas the previous maximum benefit was $500, for someone who earns $45,000 it's now closer to $1,500. Block noted that FedEx also is capping benefits on its traditional pension plan as it transitions to a cash-balance plan -- "a portable pension that combines features of a traditional pension and a 401(k)."

Other companies cutting back on or eliminating traditional pensions include Nissan (NASDAQ:NSANY), Circuit City (NYSE:CC), Hewlett-Packard (NYSE:HPQ), Motorola (NYSE:MOT), Sprint Nextel (NYSE:S), and Alcoa (NYSE:AA).

What to do
So what should you do with this information? Well, here are some possibilities:

  • Keep contributing to your company's retirement plan, and consider upping your contributions. Many experts suggest saving 10% of your income for retirement. But aiming for 15% or more can be more effective, especially in your earlier years, for maximum growth, or your later years, if you find yourself behind schedule.
  • If your employer's match is paltry, look into whether it might be raised. Expect more companies to increase their matches in the years ahead.
  • Invest your money effectively. You can learn much more in our 401(k) nook. Our IRA Center can also help you save for retirement.
  • Learn more about the newfangled and exciting Roth 401(k), a cross between a Roth IRA and a 401(k). Roughly one in five companies offers them now, and nearly two-thirds are looking into adding them.

Finally, I encourage you take advantage of a free 30-day trial of our Rule Your Retirement newsletter service. It's prepared by Robert Brokamp, a smart and witty guy who distills what you really need to know into a manageable volume each month. A free trial gives you full access to all past issues, allowing you to gather valuable tips and even read how folks have retired early and well. Robert regularly offers recommendations of promising stocks and mutual funds, too.

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Longtime Fool contributor Selena Maranjian does not own shares of any companies mentioned in this article. The Fool has a disclosure policy. FedEx is a Stock Advisor recommendation. Nissan Motor is a Global Gains recommendation. Try any one of our investing services free for 30 days.