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Freelancers, know the truth about your retirement planning.

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LAST UPDATED: April 4, 2025

Key Takeaways

  • Ask about eligibility requirements early to ensure you can start contributing to your retirement savings as soon as possible, especially if there's an employer match involved.
  • Employer retirement contributions can significantly increase your savings, so inquire about the match percentage and vesting schedule to know how much you'll get and when.
  • Review investment options carefully, as the offer of both pretax and after-tax (Roth) 401(k) options allows you to choose the best fit for your financial goals.
  • Consider automatic contributions to make consistent saving easier and ensure your retirement funds continue to grow even when moving between assignments.

When considering a new freelance opportunity with a staffing agency, you likely focus on compensation and benefits such as health insurance. But what about access to a high-quality retirement plan?

Research shows that many freelancers are deeply concerned about their retirement savings, though it might not be top of mind when evaluating a job offer. In fact, 67% of contractors consider the lack of retirement plans and other benefits a major drawback of freelance work.

The good news is that some staffing agencies offer high-quality retirement plans. Considering these benefits when evaluating an opportunity can help ease the stress of saving for your future.

Evaluating retirement plans—what should you look for?

As a freelancer, you probably know that the sooner you start saving for retirement, the better. Whether you've saved a little or a lot, asking questions beyond “Do you offer retirement plans?” can help you determine how strong the benefits package is with a staffing agency. Here are a few areas we'd recommend focusing on when evaluating those plans:

Eligibility requirements 

“How quickly do I become eligible for the retirement plan?” This should be one of the first questions you ask a staffing agency because the answer can make a big difference. For instance, if your assignment is six months but you don’t become eligible until 90 days in, you’ve already lost half your time saving—and this is especially important if there’s an employer match. 

At Aquent, freelancers are eligible for our 401(k) plans on the first of the month following their hire date, so you can start saving as soon as possible.

Employer match 

Beyond eligibility, you’ll want to know if the employer will contribute to your retirement savings. For example, if an employer matches up to 5% of your savings, that means if you contribute 5%, the employer adds another 5%, giving you a total of 10% saved each month. That adds up over time.

Vesting schedule

The downside of an employer match is that it sometimes comes with strings attached, so it’s important to learn about those early. Ask about the staffing agency’s vesting schedule, which determines how much of the employer’s contributions you can take with you when you leave. For example, Aquent offers 100% vesting on day one, meaning you can take all the employer-matched contributions right away if you move on to another opportunity.

Investment options

If you’ve ever contributed to a retirement plan, you’ll know that investments vary by plan. For example, some staffing agencies offer both pretax (traditional 401(k)) and after-tax (Roth 401(k)) options. Each has different benefits depending on your goals, so be sure to inquire about all the available options to choose the best one for you.

Rollover options and associated fees 

Because of the temporary nature of freelancing, you might wonder, “What happens to my funds when I leave?” That’s why you’ll want to understand the withdrawal rules and any associated penalties, especially if you're considering an early withdrawal. It’s also helpful to know if you can borrow against your retirement funds and the terms and conditions that apply.

Pitfalls that might hold back retirement planning efforts

Once you've figured out the details of your retirement plan, you'll want to make it as easy as possible to contribute.

When you're rotating between assignments, it’s easy to put retirement savings on the back burner. But the benefits of compound interest are significant. For example, imagine you started saving $500 per month at age 25. Assuming an annual rate of return of 6%, by the time you’re 65, that money could be worth nearly $1 million due to compounding interest. 

And even if you only contribute for a few months, you have options for keeping that money working for you long after an assignment ends, such as rolling it into an IRA or similar account.

One of the easiest ways to manage your retirement plan with a staffing agency is through automatic contributions. With this option, you don’t have to decide to save every month. Instead, you can make that decision once and put your savings on autopilot. If your circumstances change and you need to stop contributing for a while, you can make adjustments and pick up your savings plan later.

Positioning yourself for the future 

Planning for retirement can be challenging since the rewards won’t come for many years. But when you consistently contribute to a quality retirement plan, even in small amounts, your savings can grow significantly over time. Discussing all the available benefits, including retirement savings, with staffing agencies will help you position yourself stronger for the future.