Trump announces new retirement plan at State of the Union
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President Trump addresses Congress during the State of the Union. Photo: Win McNamee/Getty Images
President Trump during his State of the Union address announced plans to offer Americans access to a retirement account similar to those available to federal workers.
Why it matters: There are roughly 50 million Americans without employer-sponsored retirement plans, like 401(k)s, and there's been growing bipartisan interest in expanding access.
What he's saying: Trump said he would offer Americans who don't have 401(k)s or other employer-based retirement accounts "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," he said.
How it works: The White House appears to be expanding an existing law passed under former President Biden called the SECURE Act.
- It takes effect next year and would offer workers who already have retirement accounts up to $1,000 in matching funds.
- The White House now wants to set up retirement accounts for people who don't already have one.
- They'd just check a box on their tax form to get things started, says Teresa Ghilarducci, a progressive labor economist at the New School who is familiar with the plan.
"This is a big deal," says Ghilarducci. "It finally recognizes that most people don't have anything saved for retirement, and they don't save consistently."
- She worked on an early version of this plan with White House economic adviser Kevin Hassett in 2021.
- "The idea was to get someone far on the right and far on the left to come together," she says.
The intrigue: A White House official tells Axios that like with Trump accounts for kids, philanthropic interests will be able to contribute.
Yes, but: The one big looming threat to people's retirement savings is still on deck — the Social Security trust fund is set to be depleted in 2033, at which point recipients would see a steep cut if Congress doesn't act.
- "There's still more to be done," says Ghilarducci.
