Without an employer, individuals can contribute to a Traditional or Roth IRA by opening an account through a financial institution. Self-employed individuals may also qualify for a Simplified Employee Pension (SEP) IRA. Contribution limits for 2023 are $6,500 ($7,500 if age 50+). To qualify, one must have taxable income and file a tax return, even if no tax is owed. Traditional IRA contributions may offer tax deductions, reducing taxable income, while Roth contributions are made with post-tax dollars and grow tax-free.

The primary reason contributing to an IRA without employer involvement is feasible is the IRS’s design of individual retirement accounts (IRAs) to serve those without employer-sponsored plans. The 2023 contribution limit of $6,500 ($7,500 for those aged 50+) applies uniformly, regardless of employment status, as noted by the Internal Revenue Service (IRS). Self-employed individuals can leverage SEP IRAs, which allow contributions up to 25% of net earnings or $66,000 in 2023, providing higher flexibility. Tax benefits remain accessible: Traditional IRA contributions reduce taxable income, potentially lowering tax liability, while Roth IRAs offer tax-free withdrawals in retirement. For example, a single filer contributing the maximum to a Traditional IRA in 2023 could reduce their taxable income by $6,500, saving approximately $1,500 at a 23% marginal tax rate. The IRS reports that 23 million Americans contributed to IRAs in 2022, with median account balances of $95,000, highlighting the tool’s widespread adoption. Income limits for Roth IRAs (e.g., single filers earning ≤$136,000 in 2023) ensure accessibility across income levels. These structures empower individuals to build retirement savings independently, addressing the 43% of U.S. workers without access to employer retirement plans, per the Federal Reserve’s 2022 Survey of Consumer Finances. By enabling tax-advantaged savings, IRAs mitigate retirement insecurity, particularly for the self-employed and unemployed.