Why It’s So Hard to Get Gig Workers to Save for Retirement

Few deny the savings power of payroll deductions, whether paying into Social Security or saving into a retirement plan. Workers are enrolled in a retirement plan, money moves automatically from payroll into an account, and inertia begins working in favor of saving, rather than against it. But for millions of independent contractors, freelancers and gig workers, that machinery largely disappears.

Lawmakers are trying to solve the problem: Congress has made proposals that would open pooled retirement plans to independent workers and make it easier for companies to contribute toward portable benefits without turning contractors into employees. President Donald Trump, meanwhile, ordered the creation of a federal platform scheduled to launch by January 1, 2027, that would steer workers without employer plans toward low-cost individual retirement accounts and publicize a federal Saver’s Match of as much as $1,000. 

The proposals reflect unusually broad interest in closing a stubborn retirement coverage gap. Yet interviews with retirement policy experts suggest that passing another retirement bill is only part of the challenge. The harder question is how to make saving nearly as automatic for a DoorDash driver or freelance consultant as it is for an employee whose 401(k) contribution comes out of every paycheck.

“It’s not about options; it’s about engagement,” says Angela Antonelli, executive director of Georgetown University’s Center for Retirement Initiatives. “How do we find them and how do we engage them so that they start to save?”

Gap Has Proved Difficult to Close

There are signs that retirement access is improving for traditional workers.

The share of small businesses with an active retirement plan climbed to 31% in 2026 from 19% in 2019, a payroll and benefits provider. Hourly workers made particularly large gains: 38% had a plan available in 2026, up from roughly 22% in 2019, while the share actually saving through an employer-sponsored plan more than doubled—to 17% from 7%.

State automatic IRA programs are one avenue through which that expansion has taken place. Fifteen states had active programs in early 2026, with more than 1 million workers accumulating more than $2.5 billion, according to the Pew Charitable Trusts. By July, Georgetown’s Center for Retirement Initiatives counted roughly 1.36 million funded accounts and $3.27 billion across 14 reporting auto-IRA programs.

But those programs illustrate the central complication for independent workers: Automatic enrollment works most naturally with an employer and when a payroll system does the enrolling.

Mark Iwry, a former deputy assistant secretary of the treasury for retirement and health policy, says the gig worker coverage problem is fundamentally practical. Independent workers often lack the regular payroll connection that has made automatic enrollment such a powerful tool for employees. Additionally, their income is more likely than full-time workers to fluctuate, and payments can include money intended to cover business expenses, making a default contribution based on gross receipts difficult to calibrate.

Congress is seeking ways around that problem.

The Independent Retirement Fairness Act, introduced by Senator Bill Cassidy, R-Louisiana, would extend elements of the employer retirement system to independent workers and direct officials at the Department of the Treasury and the Department of Labor to test mechanisms such as automatic contributions and “rounding” portions of contractor compensation into pooled employer plans or solo 401(k)s.

Another possibility is to mimic automatic bill payment: allow an independent worker to authorize recurring transfers from a bank account into retirement savings. Professional or trade associations could also aggregate workers, Iwry says, with an eye toward negotiating access to low-cost accounts, creating some of the scale and convenience normally supplied by an employer.

The Classification Problem

Getting businesses involved, however, raises a thornier question: When does helping a contractor look too much like employing one?

Cassidy’s Unlocking Benefits for Independent Workers Act would address that directly. Under the bill, providing portable benefits or making contributions toward benefits commonly offered to full-time employees could not be considered when determining whether a worker is an employee under federal law. Yet the legislation has not moved forward.

Supporters see such a safe harbor as a way to encourage platforms and other businesses to help contractors save without exposing themselves to greater classification risk.

Antonelli says companies with large independent workforces could become an important conduit between workers and retirement accounts, but businesses need a reason to participate—and confidence that doing so would not inadvertently alter a worker’s legal status.

That same idea is also a fault line. Labor advocates have long worried that expanding employee-like benefits for contractors could make it easier for companies to classify workers as independent while avoiding the broader protections attached to employment. Iwry says that classification debate is the major political issue lurking beneath otherwise technical discussions over retirement access.

AARP officials likewise say policymakers are watching for reforms that could encourage workers doing traditional W-2 jobs to be reclassified as independent contractors.

From Proposals to a Package

The politics of retirement legislation may nevertheless offer an opening.

Chad Mullen, AARP’s director of financial security, says the chief congressional obstacle is often less ideological disagreement than competition with whatever issue is most urgent. Retirement policy has historically moved through bipartisan packages, and he said another broad package focused on coverage could emerge, although potentially not until the next Congress begins in January 2027.

The White House has added another piece. Trump’s April executive order directs Treasury to base TrumpIRA.gov on private sector IRAs with low fees, no minimum balance or contribution requirements, and access to the Saver’s Match, with particular attention to independent contractors, self-employed people and others without workplace plans. The executive order also directs Treasury to recommend legislation that would codify the approach.

Yet a website, an IRA or even a new pooled plan still requires a worker to encounter it and act.

That may be why the state experience looms so large in the debate. Gusto found that retirement plan adoption rose more quickly among very small businesses in states with auto-IRA mandates, though adoption increased elsewhere too. Among businesses with two to five employees, active plan adoption increased 121% in auto-IRA states, compared with 54% in other states.

For federal policymakers, Antonelli argues that the lesson is not necessarily to replace what states have built, but to use it.

“As we look to the future, I would say to anybody at the national level, ‘Look to the states and look to these state programs,’” Antonelli says. “Because the state programs, along with private sector providers, are already building that fundamental infrastructure that we can continue to expand and scale to reach more and more American workers.”