President Trump has unveiled a new initiative aimed at expanding retirement savings opportunities for American workers who currently lack access to employer-sponsored retirement plans. This proposal, announced during his State of the Union address, seeks to provide these workers with retirement accounts similar to the existing Thrift Savings Plan (TSP) used by federal employees, along with a matching contribution of up to $1,000 annually.
During his address, President Trump highlighted a significant disparity in retirement savings access, noting that nearly half of all working Americans do not have access to a retirement plan that includes employer matching contributions. To address this, his administration plans to roll out a new program next year, offering a retirement savings vehicle that mirrors the federal government's TSP. This initiative is designed to encourage more Americans to save for their future, potentially reducing reliance on Social Security and enhancing their financial security in retirement.
The proposed retirement accounts are structured to be similar to a traditional 401(k), allowing participants to choose from various investment options and make contributions directly deducted from their paychecks. A key feature of this plan is its portability, meaning workers can maintain their accounts even if they change jobs, ensuring continuity in their retirement savings efforts. Furthermore, the White House indicated that these accounts would also be open to contributions from private donors, adding another layer of potential funding.
The government's matching contribution, up to $1,000, is set to be implemented through a provision within the Secure 2.0 law, which was enacted in 2022. This legislation includes the Saver's Match program, designed to provide eligible low-income taxpayers with a matching contribution to their IRA or other retirement plans, beginning in 2027. Under the Saver's Match, qualifying individuals could receive a 50% match on contributions up to $2,000, effectively boosting their retirement savings.
This is not the first time such a proposal has been put forth. The Retirement Savings for Americans Act, first introduced in Congress in 2022 and reintroduced in May 2025, aimed to establish retirement accounts and provide matching contributions for low- and middle-income workers who lack employer-sponsored plans. However, that bill has yet to gain significant traction. Data from the Economic Innovation Group, a bipartisan think tank, indicates that 42% of American workers (excluding government and self-employed individuals) do not have access to a retirement plan, and over half of those who do, do not receive an employer match. This underscores the widespread need for initiatives like President Trump's proposal to address the existing gaps in retirement savings coverage.
The president's proposal aims to alleviate a significant challenge faced by many Americans, providing a structured pathway to retirement savings that includes incentives for participation. By drawing parallels with the successful Thrift Savings Plan and leveraging existing legislative frameworks like Secure 2.0, the administration hopes to empower more individuals to secure their financial futures.