Workers without access to employer-sponsored retirement plans are falling further behind in savings accumulation, with the median balance for this group now less than $12,000 compared to over $85,000 for those with workplace 401(k) access.
State-sponsored auto-IRA programs in 16 states are beginning to close the gap, automatically enrolling eligible workers into Roth IRA accounts with default contribution rates of three to five percent of pay. Early participation data is encouraging.
Financial planners emphasize that even small monthly contributions to an IRA can compound significantly over a 30-year career and urge self-employed and gig workers to explore SEP-IRA and Solo 401(k) options.
