An estimated 8.5 million people who aren't saving for retirement are likely to start saving when the saver's match under the SECURE 2.0 Act kicks in, according to a study released April 9 by the Retirement Clearinghouse and Boston Research Technologies.
In addition, 90% of retirement savers eligible for the saver’s match would be very or somewhat likely to save more, the study found.
The saver’s match program, which goes live in 2027, will allow qualified Americans participating in an employer-sponsored retirement plan or contributing to an individual retirement account to receive a 50% federal matching contribution up to a maximum of $1,000 if filing individually.
The money is deposited directly into the taxpayer’s retirement plan account or IRA.
The program was designed to help lower-income savers or those with an adjusted gross income of $71,000 or below if married and filing jointly, $53,250 or below if filing as head of household, or $35,000 or below if single or married but filing separately.
“The results of the study clearly show that the saver’s match can have a substantial impact on the target populations’ retirement-saving behaviors,” said Warren Cormier, CEO of Boston Research Technologies, in a news release.
The saver’s match would have an especially strong impact on Black and Hispanic savers, who represent 25.6% of eligible match savers.
The study found that 93.6% of Black savers and 92.3% of Hispanic savers would contribute more to their retirement accounts if they could receive a federal matching contribution, as compared to 89.1% of White savers.
Among nonsavers, 78.2% of Hispanic Americans and 76.9% of Black Americans would be more likely to begin saving for retirement in order to receive the federal matching contribution, higher than the overall 73.5% of workers who are not saving but otherwise would be with a saver’s match.
The survey represents 3,061 Americans who would qualify for the saver’s match based on their income and filing status. Of the 3,061 respondents, 1,667 had saved during 2023, and 1,394 had not. The survey was conducted between Feb. 5 and Feb. 17.
