{"id":363136,"date":"2026-03-01T23:59:20","date_gmt":"2026-03-01T23:59:20","guid":{"rendered":"https:\/\/www.europesays.com\/ie\/363136\/"},"modified":"2026-03-01T23:59:20","modified_gmt":"2026-03-01T23:59:20","slug":"they-want-to-know-what-the-catch-is","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ie\/363136\/","title":{"rendered":"\u2018they want to know what the catch is\u2019"},"content":{"rendered":"\n

With rising prices and one of two Social Security trust funds set to dry up by 2032<\/a>, a comfortable retirement seems more and more out of reach<\/a> for many Americans.<\/p>\n

The Trump administration wants to change that. At Tuesday\u2019s State of the Union, President Donald Trump announced<\/a> a plan to bring retirement savings accounts to the 54 million American adults who don\u2019t have employer-backed retirement plans. Economists<\/a> have estimated that a plan like Trump\u2019s would help the poorest 25% of Americans save between $138,000 and $610,000 for their retirement.<\/p>\n

Workers who never had a retirement savings plan have long been suspicious of programs like this for good reason, said Teresa Ghilarducci, a professor of economics at The New School, who was one of the economists behind the development of Trump\u2019s plan.<\/p>\n

\u201cMany of the [low-income earners] that I\u2019ve talked to really want me to sit down and explain how it worked for them, because they\u2019ve just been excluded from a system like this for their whole careers,\u201d Ghilarducci, who has studied retirement security for 42 years, told Fortune. \u201cThey want to know what the catch is.\u201d<\/p>\n

Even as the proposed accounts are a major step toward more financial security for low-income Americans, there are obstacles to the program\u2019s success.<\/p>\n

Americans have already seen the fallout of a retirement program for low-income workers. In 2015, President Barack Obama launched the MyRA program (for My Retirement Account), but eligible workers faced barriers like the surprisingly difficult act of enrolling. Studies<\/a> show that participation in retirement plans increases by 50% when employees are automatically enrolled. Though the enrollment process was fairly simple\u2013you had to go to a website, check a box, and then you would be enrolled\u2014after two years, the Department of Treasury shuttered<\/a> 30,000 newly opened accounts after determining it wasn\u2019t cost-effective.<\/p>\n

That distrust is warranted, Ghilarducci said. \u201cFor the third of workers, their money is safer in a shoe box under the bed than it is in an IRA\u201d because of monthly fees.<\/p>\n

While Ghilarducci argues<\/a> that all eligible workers should be automatically enrolled, which is not currently part of Trump\u2019s plan, the new program has a fundamental difference to Obama\u2019s, she said. The administration will match savings up to $1,000 each year, providing a necessary incentive to enroll.<\/p>\n

\u201cIf you have systems where low-income people get a direct match, and they can actually see their money grow in any significant way, participation goes way up,\u201d she said.<\/p>\n

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

\u201cAlmost no one is close\u201d to that amount, BlackRock CEO Larry Fink said in a letter<\/a> to shareholders last year.<\/p>\n

A younger Baby Boomer herself, Ghilarducci said she\u2019s seen how the retirement system hasn\u2019t delivered for many Americans.<\/p>\n

\u201cI honestly thought that we would have a much more expanded private sector plan and bigger social security benefit by the time I\u2019m retiring, and I\u2019ve just watched the system get worse and worse,\u201d she said. According to the Economic Innovation Group, 78.7% of full-time workers in the lowest-earning decile don\u2019t have access to retirement plans, compared to just 18.2%in the highest-earning decile.<\/p>\n

Ghilarducci believes that low-income workers need a bigger match than $1,000 each year and said she hopes Congress will pass a more generous match for workers.<\/p>\n

\u201cThis is an architecture, a design, where they have the best chance of putting some money in their accounts early in their life, keep it there and then,\u201d she said. \u201cWhen you do that, you take advantage of the magic of math, because compound interest kind of takes over for the workers\u2019 contribution.\u201d<\/p>\n

This story was originally featured on Fortune.com<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"With rising prices and one of two Social Security trust funds set to dry up by 2032, a…\n","protected":false},"author":2,"featured_media":363137,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[177],"tags":[79,18,168999,19,17,234,235,3887,4036,23370,53288,187],"class_list":["post-363136","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-business","tag-eire","tag-eligible-workers","tag-ie","tag-ireland","tag-personal-finance","tag-personalfinance","tag-retirement","tag-retirement-savings","tag-retirement-savings-plan","tag-teresa-ghilarducci","tag-trump"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ie\/116156639669319332","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/363136","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/comments?post=363136"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/posts\/363136\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media\/363137"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/media?parent=363136"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/categories?post=363136"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ie\/wp-json\/wp\/v2\/tags?post=363136"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}