The Saver’s Match law passed in 2022, and an executive order creating the TrumpIRA will offer combined retirement savings for up to 26 million low-income Americans beginning January 1, 2027. The two measures are an effort to narrow the retirement savings gap, but they do not always align with state plans already in place. Here is how they will work.
What is the TrumpIRA?
Many small-business employees, independent contractors, self-employed individuals, and part-time workers do not have access to pensions, 401(k)s, and other retirement options. The TrumpIRA creates a marketplace, similar to the Affordable Care Act (ACA), that connects workers without employer-sponsored plans to a variety of low-cost private Individual Retirement Accounts (IRAs).
Created by executive order, the TrumpIRA allows workers without access to a qualified company retirement plan to more easily build retirement savings. It also opens access to the Saver’s Match.
What is the Saver’s Match?
Created by the SECURE 2.0 Act in 2022, the Saver’s Match replaces the Saver’s Credit, which is a non-refundable federal tax credit.
The Saver’s Match provides a 50% match for qualifying workers contributing up to $2,000 for singles and $4,000 for couples to specific retirement accounts, including a traditional IRA, 401(k), 403(b), or government 457(b) plan. Singles earning up to $20,500 and joint filers making up to $41,000 annually qualify. The match declines for participants earning above those amounts until it phases out at $35,500 for singles and $71,000 for couples.
What are State Auto-IRAs?
Many states already have retirement savings plans for workers who lack access to employer-sponsored plans.
Currently, 21 states have enacted legislation for work-and-save programs. Most are Auto-IRA plans that offer retirement savings. Of those, 17 programs are fully operational.
Employers that do not offer retirement plans are required to enroll employees in these plans. That allows workers to have money automatically deducted from their pay and deposited into an IRA managed by a state-approved financial program manager.
Assets held in the 17 functioning plans have surpassed $3.2 billion in more than 1.3 million employees, according to the Georgetown Center for Retirement Initiatives.
Crucial Mismatch
One problem with the Saver’s Match is that it is designed to work with traditional retirement accounts. However, similar state and city plans are geared to Roth accounts.
SavingAdvice asked California State Treasurer Fiona Ma, who oversees her state’s Auto-IRA program, CalSavers, whether this mismatch affects existing state programs.
“This issue is crucial to many state Auto-IRA programs like CalSavers given that those programs predominantly default into Roth IRAs as you mentioned,” noted Ma. “The state Auto-IRA industry, which includes CalSavers, has lobbied the U.S. Treasury and Congress to change this imbalance and allow Saver’s Match funds to be deposited into Roth IRAs. That change has not materialized yet, but there is still technically enough time that it may happen.”
Working Out The Kinks
Ma and her counterparts in other state and local Auto-IRA programs are working with the U.S. Treasury Department to try to make the rollout of the new plans run smoothly.
In addition, Ma teamed up with state Assembly Member Gail Pellerin to create the SAVE for All Workers Act, which is currently in the Senate’s Appropriations Committee. The bill clears a legal pathway for CalSavers to open traditional IRAs and receive Saver’s Match funds.
The Workaround: How to Claim Your Match Even With a Roth
With almost half a year until implementation, state and federal officials may work out the technical differences between these plans. However, if they don’t, here is how you can keep benefiting from your workplace plan and get the extra boost from the Saver’s Match.
Keep your automatic payroll deductions flowing into your state’s Roth IRA.Open a traditional IRA.When you file your federal taxes, supply account information for the traditional IRA.
Caution About the Workaround
The Saver’s Match applies to any funds contributed to an IRA. That includes any payroll deductions that go into a state Roth IRA. So, if you put $2,000 a year into a state-mandated Roth plan, the federal government will match 50% ($1,000) and deposit it into your separate traditional IRA. But you must have the separate traditional IRA set up for this to work.
You need to be careful when selecting your traditional IRA. Some financial institutions require a minimum or initial deposit to open such accounts. However, many firms, such as Fidelity, Vanguard, and Charles Schwab, offer no-minimum accounts. In addition, the TrumpIRA marketplace plans do not require minimums.
TrumpIRA Does Not Mesh With Auto-IRAs
Even if a state smooths out the disconnect between the Saver’s Match and its Auto-IRA program, the TrumpIRA presents another problem.
“Under the current proposed framework, the TrumpIRA.gov program does not integrate with existing state-mandated Auto-IRA programs like CalSavers,” notes MA.
Most state and local work and save programs are mandated for certain businesses that do not offer their own retirement savings plans. The TrumpIRA is a voluntary program.
“State-mandated Auto-IRAs like CalSavers require employers to participate in CalSavers if they do not already offer a tax-qualified retirement program that exempts them (think 401 (k) s, 403 (b) s, etc.),” says Ma. “Since TrumpIRA.gov is not an employer-managed plan, they cannot integrate with CalSavers or qualify for an exemption from CalSavers.”
Workers Could Opt for TrumpIRA
Even though Auto-IRA programs must be offered by certain businesses, individual employees can jump ship for the TrumpIRA.
“Workers can opt out,” notes Ma, “and some could choose to instead open an IRA independently through a platform like TrumpIRA.gov, but that scenario is unlikely to materialize at scale.”
Ma contends that switching from an established state plan to the TrumpIRA marketplace goes against human nature.
“The behavioral economics research is unambiguous on this point: workers are 15 times more likely to save for retirement when they can do so through a payroll-deduction workplace plan, and 20 times more likely when enrollment is automatic,” says Ma. “Expecting workers who lack access to employer-sponsored retirement plans to proactively seek out, compare, and enroll in an IRA on their own — even a federally promoted one — runs counter to everything we know about voluntary retirement savings behavior.”
Data from Vanguard supports Ma’s position. It shows that auto-enrollment retirement plans have a 94% participation rate compared to 64 percent for voluntary enrollment plans.
Where the TrumpIRA Fits
The TrumpIRA is likely to do better in states without an Auto-IRA program. That is because there is no other opportunity for workers to get such coverage, and the need is significant.
In addition to helping workers, the TrumpIRA may provide a boost for small businesses.
Many job candidates value benefits as highly as they do salary. Nick Pasquarosa, founder and CEO of Bookkeeper360, told Saving Advice the TrumpIRA will help small businesses compete for talent.
“TrumpIRA.gov gives small businesses another way to support employees’ retirement savings, even if they aren’t yet in a position to offer a traditional 401(k),” stated Pasquarosa. “While it doesn’t replace the value of an employer-sponsored retirement plan and company match, it does help narrow the benefits gap by making retirement savings more accessible. For small businesses competing for talent, TrumpIRA.gov is another meaningful tool that can strengthen recruiting until they’re ready to implement a full 401(k) program.”
Comparing Low- and Moderate-Income Retirement Funding Options
Some things can still change in how federal and state programs can work together, but the details below are fixed.
This table was created using information from the following sources: Carlton Fields, U.S. Treasury, Retirement Clearinghouse, The New School
State Plans for Workers Without Employer Retirement Plans
Currently, 16 states have Auto-IRA plans in place, and another two are adding them in 2027. Here is a breakdown of what all 21 states are offering workers not covered by an employer plan.
California: CalSaversColorado: Colorado SecureSavingsConnecticut: MyCTSavingsDelaware: Delaware EARNSHawaii: Hawaii Retirement Savings Program (Launching soon)Illinois: My Illinois Savings (formerly Illinois Secure Choice)Maine: Maine Retirement Savings ProgramMaryland: MarylandSavesMinnesota: Minnesota Secure ChoiceNevada: Nevada State Treasurer PlanNew Jersey: RetireReady NJNew York: New York State Secure ChoiceOregon: OregonSavesRhode Island: Rhode Island Retirement Savings Board planVermont: VT SavesVirginia: RetirePath VA
States Offering Alternative Retirement Programs
Although five states currently offer voluntary plans for small businesses and their employees, two of them will add Auto-IRA plans next year. Here is a rundown.
Massachusetts offers the CORE Plan, a state-sponsored Multiple Employer Plan (MEP). However, it added an Auto-IRA model under its 2026 appropriations bill. New Mexico Work and Save offers a voluntary retirement marketplace.Washington Small Business Retirement Marketplace is a voluntary plan that connects small employers to verified low-cost private plans. Although it will launch an Auto-IRA program in 2027.Utah Retirement Plan Exchange is a voluntary marketplace launching on January 1, 2027.Missouri Show-Me MyRetirement Savings Plan, a voluntary multiple-employer retirement plan framework.
Where does your state land in the discussion? How will the TrumpIRA or your state’s plans impact your retirement planning? Share your thoughts in the comments below.
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Max K. Erkiletian is a seasoned journalist and analytical reporter with nearly 40 years of experience. He has been nominated for several honors and was part of a team that won the Missouri Press Association’s Community Service Award.
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