Chris Nicholls

The Saver's Match was created as a provision in SECURE 2.0.Beginning in 2027, the program will provide eligible taxpayers a 50% match on the first $2,000 of qualified retirement savings contributions, for a maximum match of $1,000 per individual for each tax year. That amount doubles to a maximum of $2,000 for plan participants or IRA contributors who are married and filing joint tax returns.

While the new retirement plan will not become effective for two more years, the Morningstar Center for Retirement and Policy Studies already believes it will close the retirement gap for Gen Z and millennials, as well as single women and low-income employees.

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Saver's Match eligibility extends to those taxpayers who have an adjusted gross income of $35,000 or under if they are single, or married but filing taxes separately. A "savings sweetener" for low-income workers who participate in their employer-sponsored plan, the Saver's Match is a benefit that can be claimed in addition to any employee contributions or employer match.

According to Morningstar’s new research, The Impact of the Saver's Match on Retirement Wealth, here are some of the highlights:

  • Savers eligible for the full match could experience significant increases in retirement wealth, with scenarios projecting mean boosts of up to 12.01% overall.
  • Single women stand to benefit disproportionately, with potential wealth increases reaching 13.13%.
  • Non-Hispanic Black Americans and Hispanic Americans are projected to gain the most in percentage terms, with wealth increases averaging 14.57% and 12.10%, respectively.
  • Workers in industries prone to higher retirement-income inadequacy, such as agriculture and retail, are expected to see larger wealth increases compared to peers.
  • Maximum benefits are achieved when savers adjust their behavior to fully leverage the program's matching incentives.

To maximize the impact, it is critical for the government and the retirement industry to promote the program, according to Morningstar. Plan sponsors, in particular, can make a big difference by providing targeted communication aimed at low- to moderate-income workers who might qualify.

We spoke with co-author of the report, Spencer Look, who is associate director of the Morningstar Center for Retirement and Policy Studies, to discuss how employees can get the benefits of Saver’s Match and how employers can get the word out about the retirement plan to the specific employees.

Q: How much more can Gen Z and millennials save in retirement if they participate in the new Saver's Match? 


Spencer Look: We found that Gen Z and millennials eligible for the full match could see a significant boost to retirement wealth, with our scenarios showing a mean increase of up to 12.01% overall. Whether this is achieved will largely depend on the effectiveness of program promotion and education efforts.

Q: How will single women benefit from Saver's Match? 

Look: In our research, we found that 43.2% of single women will qualify for the program compared to 35.3% of single men and 29.9% of couples. Further, when analyzing the change in retirement wealth under our behavioral scenarios, we noted that single women could see a 13.13% increase in wealth, compared to 12.07% for single men and 8.4% for couples. This shows that the new program could help reduce the gender-savings gap.

Q: How can savers adjust their behavior to fully leverage the program's matching incentives? 

Look: Individuals qualifying for the program should, when possible, save at least $2,000 a year to a qualified retirement account, such as an IRA or a 401(k), to receive the maximum match of $1,000.

Related: Saver’s Match: New SECURE 2.0 program could close the wealth gap in 401(k)s

Q: How can plan sponsors make a big difference to communicate with low and moderate income workers who might qualify? 

Look: Plan sponsors can integrate targeted and personalized outreach into their existing educational programs, making it easier for low- to moderate-income workers to engage. Plan sponsor promotion may also be more successful at building awareness of the Saver’s Match than other campaigns since plan sponsor communications are often seen as more trustworthy. Additionally, plan sponsors can see whether workers are currently saving to the employer-sponsored retirement plan and could nudge workers to save more to get the full match.  

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Lynn Cavanaugh

Lynn Varacalli Cavanaugh is Senior Editor, Retirement at BenefitsPRO. Prior, she was editor-in-chief of the What's New in Benefits & Compensation newsletter. She has worked for major firms in the employee benefits space, Vanguard and Willis Towers Watson, as well as top media companies, including Condé Nast and American Media.