Flexible Retirement and the Gig Economy

In today’s America, if you want to be a freelancer or gig economy worker, you need to make a basic trade-off.  You get freedom, independence, and (hopefully) more money in exchange for zero benefits and lots of risk in terms of paying for health care and retirement.   Investing for retirement is particularly challenging, as daily pressures often trump far-sighted financial planning.  Moreover, affordable retirement savings options aren’t widely available. A new Small Business Majority poll took a look at these issues and asked free lancers about their retirement plans.  The poll surveyed freelancers from around the US, and found a paradox.  This surveyed group reported that they were thriving, with 53% reporting that they were “doing well.”  Meanwhile, 40% of respondents had no retirement plan at all.   Surveyed freelancers pointed to cash flow as a major impediment; they lacked needed savings to plow into IRAs and other existing retirement vehicles.  They expressed strong support for more flexible and portable retirement savings plans that allow for easier movement between freelancing and full-time employment, and which provide more automatic procedures for enrollment and investment.    These desires don’t seem like a big lift as such retirement plan features are already commonplace for full-time employees. It’s time to offer similar flexibility and savings options for the independent workforce.