Saving enough for retirement is a challenge for most people these days, but if you don't have access to a 401(k) through your employer, it can feel nearly impossible. You'll have to open your own retirement account, choose your own investments, and remember to make contributions on your own. And of course, you have to find cash to spare in the first place.
It's a lot, and employers and the government have started to take notice. There's a growing movement to help workers without access to workplace retirement plans, and it's important to understand your options before making any decisions.
Image source: Getty Images.
There's a major change coming to IRAs in 2027
In April, President Donald Trump signed an executive order to create TrumpIRA.gov, a new website that will enable employees without access to workplace retirement plans to open IRAs starting next year.
These IRAs will be offered through private-sector institutions, and they will have the same contribution limits as traditional and Roth IRAs opened elsewhere. But they will also give low-income savers the opportunity to claim up to a $1,000 federal Saver's Match.
The idea for the Saver's Match originated with the SECURE 2.0 Act, passed at the end of 2022. It will replace the current Saver's Tax Credit, instead offering workers a 50% match on up to $2,000 of their own retirement contributions. This is less than what many 401(k) matches are worth, but it's a huge plus for workers who might otherwise have to save on their own.
It won't be an option for everyone, though. Single filers earning more than $20,500 and married couples earning more than $41,000 may be eligible for a reduced match, while single adults earning more than $35,500 and married couples earning more than $71,000 will not qualify for the match at all.
States are stepping in to help, too
State governments have also begun passing auto-IRA program laws to help workers without access to 401(k)s. Seventeen states currently have laws like this, and Alaska recently voted to join them.
These programs enable employers who don't offer 401(k)s to auto-enroll employees who choose to participate in the state IRA program. The employer defers a percentage of the employee's paychecks into the account. Some plans have auto-escalation rules that increase your contribution rate over time. Workers always have full control over how much they contribute, though, and can pause their contributions if they wish.
These accounts are identical to the traditional or Roth IRAs you can open with many private financial institutions. But they reduce a lot of the burden for you. You don't have to remember to make contributions, and you often don't even need to think about what to invest in. Many have default investment options, usually target-date funds, so you can set and forget your portfolio.
It gives you some of the convenience of a 401(k), but it's ultimately up to you to decide whether one of these options suits you. Compare your state's program, if it exists, to other traditional or Roth IRAs to see which you like best.
