Trump Proposes Government-Backed 401(k) Plan for Workers Without Employer Retirement Benefits

The new plan would provide a $1,000 annual match to help millions of Americans save for retirement.

Published on Feb. 26, 2026

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President Donald Trump announced a proposal during his 2026 State of the Union address to create a government-backed 401(k) plan that would give workers without employer retirement benefits access to accounts modeled after the federal Thrift Savings Plan. The government would match contributions up to $1,000 per year, aiming to help the 57 million Americans who currently lack access to an employer-sponsored retirement plan.

Why it matters

The proposal aims to address a significant retirement savings gap, as nearly half of private sector workers in the U.S. lack access to employer-sponsored retirement plans. Without an employer match, many never start saving at all, which can lead to increased demand on social assistance programs down the line. The new accounts would provide more Americans with an opportunity to build retirement savings.

The details

The new government-backed 401(k) plan would operate similarly to the Thrift Savings Plan used by federal employees, allowing workers to invest in low-cost index funds. The plan builds on the SECURE 2.0 Act signed by President Biden in 2022, which created a Saver's Match program starting in 2027. However, the White House says the new proposal offers better portfolio options and easier access.

  • President Trump announced the proposal during his 2026 State of the Union address on February 26, 2026.
  • The SECURE 2.0 Act, which created a similar Saver's Match program, was signed into law by President Biden in 2022.

The players

Donald Trump

The 45th President of the United States, who proposed the government-backed 401(k) plan during his 2026 State of the Union address.

Joe Biden

The 46th President of the United States, who signed the SECURE 2.0 Act in 2022, which created a similar Saver's Match program.

Chuck Schumer

The Senate Minority Leader, who accused Trump of rebranding Biden's retirement savings program.

Teresa Ghilarducci

A professor at The New School who co-authored research on retirement savings and called the proposal "a meaningful step to get universal coverage."

Scott Bessent

The Treasury Secretary, who told NBC's Kristen Welker that the administration could push the legislation through budget reconciliation.

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What they’re saying

“Half of all working Americans still do not have access to a retirement plan with matching contributions from an employer. To remedy this gross disparity, I'm announcing that next year, my administration will give these oft-forgotten American workers access to the same type of retirement plan offered to every federal worker.”

— Donald Trump, President of the United States (ibtimes.co.uk)

“Many, many people who are left out of the system will start accumulating for retirement.”

— Teresa Ghilarducci, Professor, The New School (ibtimes.co.uk)

“This is the president coming back for working Americans.”

— Scott Bessent, Treasury Secretary (ibtimes.co.uk)

“Trump hasn't done anything for middle class Americans, so he has to steal Biden's accomplishments.”

— Chuck Schumer, Senate Minority Leader (ibtimes.co.uk)

What’s next

The administration could push the legislation through budget reconciliation, and Congress may or may not act before November's midterm elections.

The takeaway

The proposed government-backed 401(k) plan aims to address a significant retirement savings gap by providing millions of Americans without employer-sponsored plans access to a retirement account with a government match, potentially transforming retirement security for many workers.