Millions of part-time workers gained access to workplace retirement plans in 2025, thanks to provisions in the SECURE 2.0 Act. If you work part-time and haven't been able to participate in your employer's 401(k) before, the rules have changed in your favor.
What Changed in 2025
Under the original SECURE Act of 2019, part-time employees had to work at least 500 hours per year for three consecutive years before becoming eligible for their employer's 401(k) plan. SECURE 2.0 shortened this requirement to just two consecutive years.
This means employees who worked at least 500 hours in both 2023 and 2024 became eligible to make contributions starting January 1, 2025. For context, 500 hours translates to roughly 10 hours per week over the course of a year.
Who Qualifies as a Long-Term Part-Time Employee
To be classified as a long-term part-time (LTPT) employee under the new rules, you must:
- Be at least 21 years old
- Work at least 500 hours per year for two consecutive 12-month periods
- Not meet your plan's regular eligibility requirements (which typically require 1,000 hours per year)
If you meet these criteria and your employer offers a 401(k) plan, they must now allow you to participate in making elective deferrals.
What This Means for Your Retirement Savings
The expanded eligibility opens significant savings opportunities for part-time workers.
Tax-advantaged contributions. In 2025, eligible employees can contribute up to $23,500 to a 401(k). For those age 50 and older, the catch-up contribution adds another $7,500, bringing the total to $31,000. Workers ages 60 to 63 can contribute even more—up to $34,750—under the new super catch-up provision.
Compound growth potential. Even modest contributions can grow substantially over time. A part-time worker contributing $100 per month starting at age 40 could accumulate over $60,000 by age 65, assuming average market returns. Starting earlier amplifies this effect significantly.
Important Limitations to Understand
While the new rules expand access, they come with some restrictions.
Employer contributions are optional. Employers are not required to make matching or nonelective contributions for LTPT employees, although some may choose to do so. Check with your HR department to understand your plan's specific terms.
Vesting may take longer. LTPT employees earn vesting credit for each 12-month period with at least 500 hours of service. If your employer does offer contributions, it may take additional years to become fully vested compared to full-time colleagues.
Plan requirements vary. These rules apply to 401(k) and 403(b) plans. Some employers may have more generous eligibility requirements that already include part-time workers, in which case the LTPT rules don't apply.
What Part-Time Workers Should Do Now
Check your eligibility. If you've worked at least 500 hours in each of the past two years, contact your HR department to confirm your eligibility and enrollment options.
Enroll as soon as possible. The sooner you begin contributing, the more time your money has to grow. Even small amounts can make a meaningful difference over time.
Review your contribution rate. Aim to contribute at least enough to get any employer match if one is offered. From there, increase your contribution rate as your budget allows.
Consider a Roth option. Many 401(k) plans now offer Roth contributions, which are made with after-tax dollars but grow tax-free. This can be particularly valuable for younger workers or those who expect to be in a higher tax bracket in retirement.
The Bottom Line
The SECURE 2.0 expansion represents a meaningful step toward retirement security for America's part-time workforce. If you've been working part-time and assumed you couldn't participate in your employer's retirement plan, now is the time to check again. The earlier you start saving, the better positioned you'll be for retirement.
Sources: Fidelity Investments, RSM US, IRS Notice 24-73, Employee Fiduciary, Warren Averett