Lorem ipsum dolor sit amet, consectetur adipiscing elit. Vivamus convallis sem tellus, vitae egestas felis vestibule ut.

Error message details.

Reuse Permissions

Request permission to republish or redistribute SHRM content and materials.

Employee Retirement Confidence Hasn’t Recovered Much Since Big Drop

person putting money in to a piggy bank

Employee and retiree confidence about retirement has edged up slightly since a historic drop last year, but overall confidence is still near historic low numbers.

Workers’ and retirees’ confidence in having enough money to live comfortably throughout retirement improved slightly to 68 percent of workers, up from 64 percent in 2023, and 74 percent of retirees, up from 73 percent, according to new figures from the Employee Benefit Research Institute (EBRI) and Greenwald Research. For the survey, the firms polled 2,537 people in early 2023—1,320 workers and 1,217 retirees. Last year, EBRI found that retirement confidence sunk to its lowest level since the Great Recession in 2008.

Contributing to the slight improvement is workers’ and retirees’ increased confidence in their income, with wage growth now outpacing inflation growth. The EBRI/Greenwald survey found that 28 percent of workers and 32 percent of retirees who are confident feel that way due to their finances.

Although the data found that there have been some improvements, the main headline is that retirement confidence is still too low, signaling continued concerns about the state of retirement and a call to action for employers who may consider enhancing retirement options.

“Inflation’s impact on their retirement also remains a concern among workers and retirees,” said Lisa Greenwald, CEO of Greenwald Research.

In fact, inflation is the primary culprit for U.S. residents’ faulty confidence. Among those who do not feel confident about retirement, 31 percent of workers and 40 percent of retirees cited inflation as the reason why, while 39 percent of workers and 27 percent of retirees said they feel this way due to their lack of savings.

Although inflation has dropped significantly from its 40-year high in summer 2022, inflation crept up again in March for the second consecutive month, signaling that cost-of-living pressures that have been afflicting employees for nearly two years are persisting. The most recent Consumer Price Index (CPI), released in April, found that inflation rose to 3.5 percent for the 12 months ending in March, before seasonal adjustment. That was a hotter reading than expected and up from the unadjusted 3.2 percent annual gain seen in February.

“Inflation is expanding our expectations for retirement savings and putting the pressure on to plan and stay disciplined,” Aditi Javeri Gokhale, chief strategy officer, president of retail investments, and head of institutional investments at Northwestern Mutual, said recently.

John Lowell, a partner with consulting firm October Three Consulting in Woodstock, Ga., said employees’ debt and competing financial priorities are also taking a hit on employee confidence.

“By all appearances, while American workers are starting to make use of their retirement plans at earlier ages, too many do not seem to be using them as retirement plans. Rather, they are too often simply another source of funds that is part of a vicious cycle,” he said, explaining that credit card debt and other consumer debt has increased rapidly as the amounts of retirement savings have stagnated and even declined.

“Stories abound of people of all generations gutting their retirement savings to service their consumer debt,” he said. “Sometimes, in order to do this, they change jobs and they do so for the sole purpose of accessing their retirement savings immediately.”

Recent Retirement Trends

The EBRI/Greenwald survey is in line with other recent reports finding that retirement savings have suffered in recent months.

For instance, roughly 6 in 10 employees (57 percent) at midsize and large U.S. companies said they are not confident they will be able to retire at the federal retirement age, typically between 65 and 67, according to a recent survey of 1,500 full-time U.S. workers by Nuveen, a subsidiary of TIAA. And just 3 in 10 employees strongly agreed that they are satisfied with their retirement plan.

Other research from the Nationwide Retirement Institute found that 1 in 4 women (23 percent) feel they’re “on the wrong track” for retirement, versus 15 percent of men.

And Northwestern Mutual recently found that U.S. residents’ “magic number” for retirement has surged to an all-time high—rising much faster than the rate of inflation, which currently hovers just above 3 percent. On average, U.S. adults now believe they will need $1.46 million to retire comfortably, a 15 percent jump over the $1.27 million reported last year and a whopping 53 percent surge from the $951,000 target they reported in 2020.

Although workers acknowledge they need a greater amount of money, actually saving for retirement is another story. The average amount that U.S. adults have saved for retirement is just $88,400, according to Northwestern Mutual’s survey of 4,588 U.S. adults—slightly lower than the $89,300 amount in 2023 and much lower than the five-year peak of $98,800 in 2021. It also means there is a $1.37 million gap between the average employee’s retirement goal and current savings. Baby Boomers on average have $120,300 saved for retirement, Generation X employees have about $108,600 saved, Millennials have $62,600, and Generation Z has $22,800.

Similarly, the EBRI/Greenwald survey revealed that retirement estimations drastically differ from what U.S. residents currently have saved. A third of workers who tried to calculate how much they will need in retirement estimate they will need $1.5 million or more. However, a third of workers currently have less than $50,000 in savings and investments. And 14 percent of workers have less than $1,000 in savings and investments.

Improvements Workers Want

What do employees think would help them improve their retirement confidence?

The ability to save for emergencies is at the top of workers’ list of valuable improvements they would like to see be made to their retirement savings plans, according to the EBRI/Greenwald survey. Some U.S. residents are already using their retirement plans to pay for emergencies—nearly 1 in 5 have taken a loan or withdrawal from their retirement plan. Many of those who took money from their plan did so to pay for unforeseen circumstances such as making ends meet (30 percent), paying for a home or car repair (17 percent), or covering a medical expense (15 percent).

There also is increased interest in guaranteed income products that contribute to retirement savings.

Among workers who are offered a workplace retirement savings plan, one-third said having investment options that provide guaranteed lifetime income would be the most valuable improvement to their plan.

In a data point that is significantly up this year, more workers who are contributing to their employer’s retirement savings plan—3 in 10—expect to use savings from their workplace retirement savings plan to purchase a product that guarantees monthly income for life once they retire. Moreover, the survey found, 83 percent of workers who are participating in a workplace retirement plan said they would be interested in using some or all of their retirement savings to purchase such a product.


​An organization run by AI is not a futuristic concept. Such technology is already a part of many workplaces and will continue to shape the labor market and HR. Here's how employers and employees can successfully manage generative AI and other AI-powered systems.