Today, more than one in three U.S. workers are freelancers — and this figure is expected to grow to 40 percent by 2020. Increasingly, workers are eschewing or supplementing the traditional “nine-to-five” career with independent or temporary work, but these gig workers face daunting challenges preparing for retirement.

This shift in the workforce and the implications it has on gig economy workers and their finances are detailed in “Gig Economy Workers and the Future of Retirement,” a new report from Betterment. The report highlights survey results from 1,000 U.S. respondents who are 25 years and older and working in the gig economy. Several themes emerged regarding two categories of workers: full-time giggers, workers who rely primarily on the gig economy for their income, and side-hustlers, individuals who rely on a traditional full-time job as their main source of income but supplement with a side gig economy job:

Key findings of the report include:

  • Gigging is the New Retirement Plan: For many respondents, the gig economy is replacing how they plan to earn income in retirement:
    • 16 percent plan on having gig economy jobs to supplement their retirement.
    • 12 percent of side-hustlers will keep a side-gig job as their main source of income after retiring from their traditional career.
    • One in five full-time giggers say they’ll continue to pick up incremental work in the gig economy as their main source of income following “retirement.”
  • The Gig Economy is a Debt Economy: Betterment’s survey found that more than half of gig economy workers turn to this new way of working for financial reasons, not just for the freedom and flexibility it provides. While retirement catch-up is part of the equation, debt plays a big role in why 81 percent of gig economy workers say they can’t afford to prioritize saving for retirement.
  • Being Tech-Savvy Doesn’t Translate to Finances: Giggers are often tech-savvy by nature, but there’s a major disconnect when it comes to the way they manage personal finances. 59 percent of respondents use a digital platform for their job, but only 19 percent use a digital platform for saving, and 28 percent use one for online investing.

“The emergence of the gig economy has changed the American workforce, and the way we save for retirement needs to change with it,” said Jon Stein, CEO of Betterment. “At Betterment, we’re helping investors prepare for this shift by providing solutions that go well beyond simply low-cost IRAs, by lowering costs and making investing accessible for everyone. It’s time for lawmakers to do the same by introducing a modern framework that gives non-traditional workers financial stability for the future.”