This Major City Just Launched the Country's First City-Sponsored Automatic Retirement Plan
As the Social Security Administration (SSA) continues to sound the alarm about the unlikely future of Social Security, many people are turning to different avenues to help them save for retirement. But there is a group of working Americans that struggles with this, and it's those whose employers don't offer retirement plans.
Now, one city has decided to make it easier for these folks to prepare for retirement and has launched a city-run retirement account open to eligible employees across the city. The structure of this retirement fund makes it the first of its kind, and if it's successful, we could be looking at the dawn of a whole new way to save.
Philadelphia to Launch a City-Sponsored Retirement Program
According to Stateline, Philadelphia city officials are preparing to launch the country's first-ever city-sponsored retirement plan for workers whose employers don't offer a retirement package.
The program will be called PhillySaves, and voters overwhelmingly approved adopting a change to the city's charter that requires employers to enroll their employees in the program (unless they opt out).
This will direct a portion of their paycheck to an IRA, which city officials say will help Philadelphians. "This is a big darn deal for the city of Philadelphia," Mayor Cherelle Parker said while signing the bill.
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The Plan Won't Help the Self-Employed
Like many similar plans, PhillySaves will leave self-employed residents out in the cold, according to Bloomberg Law. That's because these options aren't typically geared toward those types of workers, but instead toward people with a traditional employer who get a W-2 at the end of the year.
So, what are my fellow 1099 and fully self-employed folks supposed to do? We may have to look to Uncle Sam for help. The IRS says that self-employed Americans can contribute up to 25 percent of their net earnings to a simplified employee pension (SEP).
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You can set one up by completing Form 5305-SEP or by opening a SEP-IRA with your financial institution. You can also open your own 401(k) plan, but unlike employee-sponsored plans, there is no "matching" option to choose.
While plans like PhillySaves are a huge step in the right direction toward making retirement more accessible for all types of workers, they still underscore the need for a wider net to capture the diversity of workers in this country. With many people forced into the gig economy or working multiple jobs just to get by, it's clear that traditional retirement planning just won't cut it for modern retirees. And if the cost of living continues to rise, it's unclear whether that will even be enough for most Americans to set aside any extra savings for retirement.
Disclaimer: This article is for informational purposes only and does not constitute financial advice.
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This story was originally published May 22, 2026 at 10:04 AM.