The Decline of Traditional Pensions and the Rise of Gig-Friendly Retirement Strategies

The retirement landscape is undergoing a seismic shift. Traditional pension systems, once the bedrock of financial security for millions, are vanishing at an alarming rate. Defined benefit (DB) plans, which guaranteed lifetime income based on salary and years of service, now cover just 15% of private-sector workers in the U.S., down from 38% in 1980. Employers are increasingly favoring defined contribution (DC) plans like 401(k)s, which transfer investment risk and responsibility to employees. This transition is accelerating in the gig-driven economy, where 27.6 million households now include at least one gig worker, many of whom lack access to employer-sponsored retirement benefits altogether.

The gig economy's rise has exposed a critical gap in retirement planning. Unlike traditional employees, gig workers face irregular income streams, no automatic payroll deductions, and limited access to employer contributions. A 2025 report by the Georgetown University Center for Retirement Initiatives notes that 23 million gig workers in the U.S. lack employer-sponsored retirement plans, leaving them to navigate a complex, self-directed system with little guidance. The result? A growing retirement crisis for a workforce that values flexibility but lacks the safety nets of traditional employment.

The Gig Economy's Retirement Challenge

The decline of pensions and the rise of gig work have created a perfect storm for retirement insecurity. Traditional DB plans provided guaranteed income, shielding retirees from market downturns and longevity risk. In contrast, DC plans require individuals to manage their own investments, time their withdrawals, and hedge against inflation—all while facing unpredictable earnings. For gig workers, the stakes are even higher. A 2025 study by Hearts & Wallets found that 25% of households saved nothing for retirement, and one in four mid-life and post-retirement households are not contributing to savings. This is not merely a personal finance issue but a systemic failure to adapt retirement systems to a workforce that no longer fits the 9-to-5 model.

The solution lies in innovation. Fintech and ETFs are emerging as critical tools for gig workers to build retirement security. Let's explore how.

Fintech and ETFs: Building Blocks for a New Retirement Model

The fintech revolution has democratized access to financial tools that can address gig workers' unique needs. Digital platforms now offer automated savings, robo-advisory services, and portable retirement accounts. For example, state-run auto-IRA programs like California's CalSavers and Illinois Secure Choice have enrolled over 1 million gig workers in retirement accounts since 2019, with assets exceeding $1.1 billion. These programs act as a bridge, enabling gig workers to save through payroll-like deductions without relying on employer participation.

For investors seeking to capitalize on this shift, ETFs provide a diversified, low-cost entry into the fintech ecosystem. Here are three standout options:

1. ARKF (ARK Fintech Innovation ETF)
   This actively managed ETF targets disruptive fintech companies like Square (now Block), Coinbase, and Robinhood. ARKF's high-conviction strategy is ideal for investors who believe in the long-term growth of digital payments and blockchain-based solutions. While volatile, ARKF offers exposure to the same platforms gig workers use to manage their income. A reveals its resilience in a market where fintech adoption is accelerating.

2. FINX (Global X FinTech ETF)
   FINX takes a broader, more conservative approach by tracking a global index of fintech firms. Its holdings include payment processors like PayPal and Adyen, as well as financial software providers like Intuit. This ETF is well-suited for gig workers seeking stability while still participating in the fintech boom.

3. FDIG (Fidelity Digital Payments ETF)
   FDIG focuses on the backbone of fintech: digital payment infrastructure. With holdings in Visa, Mastercard, and Adyen, this ETF is a gateway to the companies enabling the gig economy's growth. For gig workers who rely on digital transactions, FDIG offers a way to invest in the very tools that power their income streams.

The Role of Annuities and In-Plan Solutions

Beyond fintech and ETFs, annuities are resurging as a tool to combat longevity risk. Defined contribution plans are increasingly integrating annuity options, allowing participants to convert savings into guaranteed income streams. Mercer's 2025 report highlights that retirees are under pressure to stretch savings, and annuities provide a hedge against outliving one's assets. For gig workers, who may lack the financial literacy to manage complex retirement portfolios, annuities offer a simple, predictable solution.

Policy and Personal Responsibility

While innovation is critical, policy must catch up. The Saver's Match, a federal initiative offering tax credits for low- and middle-income savers, is a step in the right direction. Similarly, portable benefits—such as retirement accounts that follow workers across multiple gigs—are gaining traction. However, personal responsibility remains key. Gig workers must prioritize automated savings, diversify income streams, and leverage tools like financial planning apps to track expenses and retirement goals.

Conclusion: A New Era of Retirement Planning

The decline of traditional pensions is not a failure but an evolution. In a gig-driven economy, retirement planning must be flexible, personalized, and technology-enabled. Fintech ETFs, auto-IRA programs, and annuities are reshaping the landscape, offering gig workers tools to build financial security. For investors, these innovations represent a golden opportunity to support a workforce in transition while capturing growth in a sector poised for disruption.

As the retirement landscape continues to evolve, one truth remains: the future belongs to those who adapt. By embracing fintech, ETFs, and proactive planning, gig workers can turn uncertainty into opportunity—and secure a retirement that aligns with their unconventional paths.