Trump IRA Order Pressures Small Employers on Retirement Plans

President Donald Trump’s push to expand individual retirement account access must find a way to boost employee sign ups without dampening efforts to encourage small businesses to offer plans to their workers, according to benefits attorneys and industry officials.

A government-backed portal offering access to private-sector IRAs could cause smaller employers to direct their workers to the Trump IRA program rather than offer a plan of their own, retirement experts said. Employer-sponsored plans typically offer advantages over IRAs, such as automatic enrollment and higher matches, and experts said the Trump IRA program should ideally be seen as a gateway to more retirement spending, not a full solution.

Businesses are also awaiting regulations from the Treasury Department about how to implement the Biden-era Saver’s Match program for retirement plans, which will provide up to $1,000 in federal funds for retirement contributions made by certain low-income workers. Both the Saver’s Match and the website—TrumpIRA.gov—are set to go into effect at the start of next year.

Trump’s executive order is targeted at individuals whose employers do not offer a retirement plan. The retirement industry has generally welcomed the administration’s move in an effort to target the roughly 56 million workers without an employer-sponsored plan.

“It’s clear that the Trump administration is thinking about ways to expand coverage. Figuring out how to do that in a way that doesn’t disrupt the private sector system that works well for tens of millions of Americans is where the rubber hits the road,” said Andy Banducci, senior vice president of retirement and compensation policy at the ERISA Industry Committee.

Banducci said the ERISA Industry Committee, which represents major employers, will work with the administration and lawmakers on the issue.

Trump’s April 30 order requires the Treasury to create a website by Jan. 1 that lists low-cost IRA options. The listed options should offer the Saver’s Match, which goes into effect next year and will match 50% of retirement savings contributions up to $1,000 for individuals making less than $35,500 and married couples earning less than $71,000. Employer-sponsored plans can also offer the Saver’s Match beginning next year if they choose to incorporate it for eligible workers.

Benefits attorneys and industry officials are divided over whether the Trump IRA push will lead smaller employers who don’t want to shoulder the cost of offering a retirement plan to instead direct their workers to the government-created portal of retirement account options.

Anne Meyer, a partner at Snell & Wilmer, said the Trump IRA program could provide an “off-ramp” for employers who don’t offer a retirement plan or are concerned about the hurdles of adding the Saver’s Match to their existing plan.

Impact on Competition

Mark Iwry, a former Treasury Department official and architect of the Obama administration’s myRA program, said it was a “possible effect” that the Trump IRA portal could lead some small business owners who are considering adding a 401(k) for employees to point their workers to the government website for savings options.

Unlike the Trump IRA portal, which will offer the potential for larger investments and higher returns, the myRA program allowed low-income workers to invest up to $5,500 a year in low-risk Treasury bonds. Total contributions were capped at $15,000 per participant.

“So it didn’t compete at all with a small employer’s 401(k), which has an investment menu including growth investments and diversified investments, and has no low limit on the amount you can accumulate,” Iwry said.

John Lettieri, CEO of the Economic Innovation Group, downplayed the risk of the Trump IRA initiative crowding out employer-sponsored 401(k)s.

“Employers that offer retirement plans overwhelmingly do so to serve employees who are well above the income threshold being targeted by the executive order and Saver’s Match,” Lettieri said.

There is a “vanishingly small” subset of employers that offer retirement plans and exclusively employ the low-income workers who would qualify for the Saver’s Match, he said.

Another benefit for companies to continue offering retirement plans to workers is that it helps attract and retain talent, said Chris Magno, head of the retirement services division at ADP. Magno said workplace plans like 401(k)s tend to offer advantages over IRAs, such as higher contribution limits, payroll deductions, and automatic savings.

“The availability of additional options could raise employee expectations for retirement benefits and increase employers’ need to offer competitive plans,” Magno said.

Saver’s Match Guidance

Employers are also watching closely for forthcoming guidance from Treasury about how to incorporate the Saver’s Match into their existing plans.

Treasury is considering how Trump’s executive order could be used to make the process of claiming matching contributions run more smoothly, Treasury official Bill Evans said at the American Bar Association Section of Taxation 2026 May Tax meeting. Evans said the proposed regulations on the Saver’s Match are “very high” on the agency’s priority list.

Once the guidance is out, employers will have to communicate to their employees about who is eligible and how they can claim the match.

“We want to make this as administratively efficient as we can possibly make it so that employers will essentially just say, great, let’s just add it on to the existing retirement plan,” said Tim Rouse, executive director of the SPARK Institute, an advocacy group for the retirement plan industry.

Meyer, the partner at Snell & Wilmer, said employers and recordkeepers will have to ensure their systems can accept the government match, track matching contributions, and report it. That could make smaller employers less likely to go through the process of adding the Saver’s Match to their existing plans.

“That’s a pretty big burden, particularly for a small employer who may not have a dedicated staff working on retirement plans,” Meyer said.