The retirement opportunity accountants can't afford to miss

Something big is happening in the American retirement landscape, and small businesses are right in the middle of it. 

Recent research from Gusto shows a dramatic shift: The share of small businesses offering an active retirement plan increased from fewer than one in five to nearly one in three between 2019 and 2025, a 58% jump in six years.

The smallest businesses are leading the charge. Businesses with fewer than five employees saw adoption rise from 12% to 19%, while businesses with five to nine employees increased from 22% to 34%. Altogether, this expansion extended access to retirement plans to 5.6 million new workers.

This shift isn't happening by accident. State retirement mandates now exist in more than 20 states, with penalties for noncompliance taking effect across new markets in 2026. The SECURE 2.0 Act also offers small businesses tax credits of up to $5,000 per year to offset plan startup costs. Employers increasingly see retirement benefits as a tool for attracting and retaining talent.

For accountants who advise small and midsized businesses, these forces are converging into something rare: a clear, time-sensitive advisory opportunity.

Help clients navigate the new retirement landscape

Historically, retirement planning for small businesses occupied a narrow lane in the accounting conversation. Most discussions focused on the owner's personal tax strategy or basic payroll deductions, while plan design and employee education were often handled by financial advisors or left untouched. That division of labor is starting to break down.

Compliance requirements are becoming more visible to clients. States have begun issuing penalties to businesses that fail to register for a state auto-IRA program or establish a qualifying retirement plan. Take California as an example: Under the state's CalSavers mandate, employers with at least one employee who don't offer a qualified retirement plan must either register for the program or adopt their own plan. Businesses that fail to comply can face penalties of $250 per employee, with an additional $500 per employee if the violation continues.

Beyond compliance, there is also a tax story many business owners don't know exists. Under SECURE 2.0, qualifying small employers can receive tax credits covering up to 100% of plan administration costs for the first three years of a new plan.

When clients face these decisions, they often turn to their accountant. Explaining the landscape and helping evaluate options is squarely in the accountant's lane.

What the data reveals about employee participation

For accountants advising small businesses, one common concern from clients is whether employees will actually use a retirement plan if one is offered. The data suggests the answer is yes.

Some of the fastest growth is happening in sectors that historically offered few benefits. Hospitality saw a 188% increase in small businesses offering retirement plans since 2019, while recreation and agriculture grew 132% and 86% respectively. Even at modest contribution rates — often 4% to 5% of income — these plans represent a meaningful first step toward savings.

The takeaway for accountants is straightforward: When small businesses offer retirement plans, employees tend to participate. That shifts the client conversation from whether a plan will be used to how to design one that works for the business and its workforce.

Three ways accountants can lead the retirement conversation

Despite this shift, many accountants are still leaving this work on the table. Many small-business owners don't realize their accountant can help them think through retirement plan options, and others default into a state auto-IRA simply because it seems like the easiest path to compliance.

That creates a clear opportunity for accountants to lead the retirement conversation with clients. Here are three ways accountants can start today.

1. Leverage the trusted advisor relationship: Start the conversation with clients. Small-business owners already turn to their accountant for guidance on major financial decisions, yet many still assume retirement plans are complicated or expensive. A proactive discussion can quickly change that perception.

Accountants are well-positioned to help clients understand the tradeoffs. State auto-IRA programs are designed as a baseline solution, not necessarily as the best long-term option. In many cases, a 401(k) allows higher contribution limits, employer matching and greater flexibility for owners and employees alike.

2. Bring tax expertise into the retirement conversation: Retirement plan decisions are closely tied to tax strategy. Employer contributions, compensation planning and deductions all interact with a client's broader tax picture.

One simple way to start is by asking: "Are you taking full advantage of the tax credits available for offering a retirement plan?" Many small-business owners don't realize how much of the upfront cost can be offset.

SECURE 2.0 created powerful incentives that many small businesses still don't fully understand. Qualifying employers can receive tax credits covering much, if not all, of the cost of starting a plan. Helping clients understand how these incentives apply to their situation is exactly the kind of guidance accountants already provide.

3. Use your visibility into payroll and client data: Many accounting firms already have visibility into the data that shapes retirement plan decisions. Whether through payroll services or financial reporting, accountants can identify clients who may benefit from offering a plan.

Start by auditing your client base. Which businesses operate in states with retirement mandates? Which have employees but no retirement plan in place? Which may qualify for SECURE 2.0 startup credits? You can also look a layer deeper: clients with growing headcount, rising payroll costs, or increasing turnover are often the ones most likely to benefit from offering a plan.

Firms don't need to administer retirement plans themselves. Building referral relationships allows accountants to identify opportunities, guide clients through decisions and connect them with the right implementation partners.

The advisory opportunity in front of you

The expansion of retirement coverage among small businesses represents a significant shift in the retirement system. State mandates are pushing more employers to act, tax incentives are lowering the cost of starting a plan, and business owners increasingly see retirement benefits as part of attracting and retaining employees.

For accountants, that combination creates a meaningful advisory opportunity. The clients in your book of business are already facing these decisions, whether to comply with a state mandate, adopt a 401(k), or rethink their broader tax and compensation strategy.

Accountants who engage proactively can strengthen client relationships, expand advisory services and help small businesses navigate this new retirement landscape.