The Trump administration wants to change that. At the State of the Union on Tuesday, President Donald Trump Office has partnered a plan to bring retirement savings accounts to the 54 million American adults without employer-sponsored retirement plans. Economists It is estimated that a plan like Trump’s would help the poorest 25% of Americans save between $138,000 and $610,000 for their retirement.

Workers without a retirement savings plan have long been suspicious of programs like this for good reason, said Teresa Ghilarducci, an economics professor at The New School, who was one of the economists behind the development of Trump’s plan.

“Many of the (low-income) people I talk to really want to sit down and explain how it’s working for them, because they’ve just been excluded from a system like this for their entire careers,” said Ghilarducci, who has been studying retirement security for 42 years. luck. “They want to know what’s going on.”

Although the proposed accounts are an important step toward increased financial security for low-income Americans, there are obstacles to the program’s success.

Americans have already seen the collapse of a retirement program for low-income workers. In 2015, President Barack Obama launched the MyRA program (for My Retirement Account), but eligible workers face obstacles like the surprisingly difficult process of enrolling. Studies shows that participation in retirement plans increases by 50% when employees are automatically enrolled. Although the enrollment process is simple—you just need to go to a website, check a box, and then you’re enrolled—after two years, the Department of Treasury closed 30,000 new accounts opened after it was determined that it was not cost effective.

That distrust is necessary, Ghilarducci said. “For a third of workers, their money is safer in a shoebox under the bed than in an IRA” because of monthly payments.

While Ghilarducci contended that all eligible workers should be automatically enrolled, which is not currently part of Trump’s plan, the new program is fundamentally different from Obama’s, he said. The administration will match the savings up to $1,000 annually, providing a much-needed incentive to enroll.

“When you have systems where low-income people get a direct match, and they actually see their money grow in any significant way, participation goes up,” he said.

Is it enough money?

A BlackRock survey of 1,000 registered voters found that on average, people think they need about $2.1 million to retire comfortably. The average 401(k) balance was $144,400 in Q3 of 2025, according to Fidelity Investmentsor less than 7% of what people believe they need.

“Almost nobody comes close” to that amount, BlackRock CEO Larry Fink said in a LETTERS to shareholders last year.

A younger Baby Boomer himself, Ghilarducci said he saw how the retirement system didn’t provide for many Americans.

“I honestly thought we would have a more expanded private sector plan and greater social security benefits by the time I retire, and I see the system getting worse and worse,” he said. According to the Economic Innovation Group, 78.7% of full-time workers in the lowest income decile do not have access to retirement plans, compared to just 18.2% in the highest income decile.

Ghilarducci believes low-income workers need a bigger match than $1,000 a year and said he hopes Congress passes a more generous match for workers.

“It’s an architecture, a design, where they have the best chance to put some money in their accounts early in their lives, keep it there and then,” he said. “When you do that, you’re taking advantage of the magic of math, because compound interest kind of takes the workers’ contribution away.”