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Millions of workers without access to a 401(k) or other workplace retirement plan could get a new way to invest \u2014 and an annual government match of up to $1,000 \u2014 under a proposal from President Donald Trump<\/a>.<\/p>\n \u201cHalf of all of working Americans still do not have access to a retirement plan with matching contributions from an employer,\u201d Trump said during his State of the Union address<\/a> Tuesday. \u201cTo remedy this gross disparity, I\u2019m announcing that next year my administration will give these often-forgotten American workers \u2026 access to the same type of retirement plan offered to every federal worker. We will match your contribution with up to $1,000 each year as we ensure that all Americans can profit from a rising stock market.\u201d<\/p>\n Roughly 56 million Americans lack access to an employer-sponsored retirement plan at work, according to 2025 research <\/a>from the Pew Charitable Trusts, an independent public policy nonprofit. <\/p>\n The Trump administration plan would provide a universal savings account to workers, which would be portable if they switch jobs. <\/p>\n<\/div>\n President Donald J. Trump delivers the first State of the Union address of his second term to a joint session of Congress in the House Chamber of the United States Capitol in Washington, D.C., on Tuesday, Feb. 24, 2026. <\/p>\n Kenny Holston | The New York Times | Via Reuters<\/p>\n<\/div>\n<\/div>\n<\/div>\n The new accounts would work similarly to the Thrift Savings Plan<\/a>, or TSP, a retirement savings and investment plan for federal employees that includes a government match and low-cost, index-based investment choices, according to the White House.\u00a0<\/p>\n How the proposed savings accounts will be taxed remains to be seen, but if they follow the TSP model, contributions could be made on a tax-advantaged basis<\/a>. Under a traditional TSP, contributions count against income for an up-front tax break, while investors in Roth TSPs contribute post-tax money and can make tax-free withdrawals in retirement.\u00a0<\/p>\n Current TSP plan participants receive matching contributions from the federal government equal to up to 5% of the employee\u2019s salary. <\/p>\n The $1,000 matching contributions in the President\u2019s proposal may involve pairing the new accounts with the Saver\u2019s Match<\/a>, a provision in Secure 2.0 that takes effect\u00a0in 2027, according to White House officials. Starting that year, workers under certain income thresholds can earn a 50% matching contribution from Uncle Sam on up to $2,000 in annual retirement savings.\u00a0<\/p>\n<\/div>\n Momo Productions | Digitalvision | Getty Images<\/p>\n<\/div>\n<\/div>\n<\/div>\n Trump\u2019s proposal is \u201ca recognition of reality,\u201d said Teresa Ghilarducci, a professor at The New School who co-authored 2021 research<\/a> with National Economic Council Director Kevin Hassett on providing low-income workers with retirement savings similar to the Thrift Savings Plan.<\/p>\n Ghilarducci said the new account would be a \u201cmeaningful step to get universal coverage\u201d for retirement savings.<\/p>\n \u201cMany, many people who are left out of the system will start accumulating for retirement,\u201d Ghilarducci said, and can reap the rewards of compound interest.<\/p>\n<\/div>\nHow the new retirement accounts would work<\/h2>\n
Which workers are \u2018left out of the system\u2019<\/h2>\n