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Robinhood Launches Retirement Savings Plan for Nontraditional Workers

S.J. Steinhardt
Published Date:
Dec 6, 2022


Aiming at nontraditional workers and others who may not have access to company-sponsored retirement savings plans, Robinhood, a brokerage platform, is launching an individual retirement account (IRA) with a 1 percent match on every dollar contributed, Marketwatch reported.

The Robinhood Retirement service will become fully available in January, though waitlist registration is already available. Its traditional IRA or Roth IRA comes with zero commissions or account minimums for those who lack an employer-sponsored retirement plan. Robinhood customers can have multiple brokerage accounts.

A big target for this service is nontraditional workers, also known as gig workers. They include jobs such as ride-share drivers, pet sitters, food delivery drivers and freelancers. It is estimated that these workers make up as much as 40 percent of America’s total workforce. In addition, many Americans without a retirement plan have a side job or a part-time job.

To be eligible for this service, contributions must come from an external source, and the match is capped at the annual IRS limits for contributions. In 2023, that will be $6,500. 

“This product was developed with the gig economy in mind,” said Steph Guild, Robinhood’s head of investment strategy. “But anyone can sign up.”

Pew Charitable Trust recently found that 77.5 percent of nontraditional workers participated in a defined contribution savings plan if they had access to one and were eligible for it. Last year, Pew found that only 22 percent of nontraditional workers have a retirement plan on the job.