The Patriot Post® · Trump's New Retirement Plan

During his State of the Union Address, President Donald Trump highlighted how well the country is doing economically — an obvious effort to reset the negative economic narrative that Democrats have promoted as a campaign issue. “Affordability,” they keep saying, but as Trump told them, “You caused that problem.”

One of the plans the president proposed to further serve American workers is similar to his Trump Accounts for children. After noting that roughly half of American workers don’t have retirement plans with employer matching contributions, Trump stated:

To remedy this gross disparity, I’m announcing that next year, my administration will give these often forgotten American workers — great people, the people that built our country — access to the same type of retirement plan offered to every federal worker. … We will match your contribution with up to $1,000 each year as we ensure that all Americans can profit from a rising stock market.

According to analysis by the Pew Charitable Trusts, roughly 56 million workers do not have a retirement plan through their employer. Furthermore, nearly 30% of Americans 59 and older lack any savings or retirement plan for when they stop working.

Many may be banking on Social Security for retirement, but the question is, just how long will it be solvent?

To that point, given the federal government’s overspending problem, would Trump’s new plan not just be another expensive program that will only further contribute to the massive national debt?

That’s not an illegitimate concern given the current state of Social Security, as noted above. Yet Trump’s plan is fundamentally different. Indeed, if it can be used as an eventual replacement for Social Security, that would be a big improvement.

Connecting more Americans to the stock market to build their retirement savings is a good idea. It certainly generates more wealth than the government, which seems to generate only more debt. Plus, thanks to government-influenced inflation, the dollar consistently devalues.

As Treasury Secretary Scott Bessent recently said, “Currently, 38% of Americans have no exposure to the equity market, and we think, over time, this is going to remedy that, so everybody will have a stake in our great, innovative economy and the American dream.”

Of course, for Trump’s plan to be fully realized, it will require congressional actions, which Bessent believes is entirely doable via budget reconciliation. He explained, “We can do it through reconciliation. And again, this is the president coming back for working Americans. Those who have been left behind.”

The details of how the plan would work are still being fleshed out, but the framework would be similar to that of the federal government workers’ Thrift Savings Plan (TSP). Under that plan, qualified workers would have various options for 401(k) investments, and the government would match up to $1,000 annually of the workers’ contributions. Furthermore, the retirement plan would move with the worker from job to job.

From a campaign standpoint, this could be a winning policy issue for Republicans heading into the midterms. And that could be especially so if Democrat lawmakers decide to oppose it.

One way or another, it will be interesting to see whether Trump’s plan comes to fruition.