For many Americans, a healthy retirement is becoming increasingly unattainable. Even though it is one of the things that keeps workers going, more than half of all Americans today do not have a retirement plan in place and rely on Social Security to make ends meet or as their entire source of income.
This unsettling fact was discovered in Allianz Life‘s 2024 Annual Retirement Study. In February and March of this year, the organization polled 1,000 Americans over the age of 25 and discovered that 56% of them do not have a sound financial plan for their post-working years.
Another thing they discovered is that nearly half (48 percent) are concerned about living too frugally and not enjoying retirement as much as they should, which is especially concerning for those who do not have enough savings to cover the difference between their potential benefit amount and expenses.
And that issue isn’t going away; 42 percent said the main concern for retirees’ financial well-being is the rising cost of living, while 35 percent were concerned about outliving their retirement assets. This was followed by 45 percent of respondents who are concerned about how to best receive distributions from their retirement funds for retirement income in order to make them last.
Other real worries raised were 32% being concerned about healthcare expenditures, and 30% believing they would overspend during retirement and run out of money.
Kelly LaVigne, vice president of consumer insights at Allianz Life, summarized the report’s troubling findings in a statement: “If you don’t know how you’ll draw on your retirement assets for income, you’re not ready to retire.”
Much of retirement planning is focused on asset accumulation, which is important, but it is also critical to understand how those assets will be used to fund your living after retirement. To do so, you must make critical decisions such as when to begin collecting Social Security and what resources you have available to pay your retirement.”
Other retirement centric surveys
This is not the first study to discover similar trends; many Americans approaching retirement do not have enough funds to sustain their needs for the foreseeable future and will be unable to save enough before taking the leap. Worse, many seniors lack sources of income other than Social Security.
Jim Davis, senior wealth manager at Texas-based Aspen Wealth Management, told Newsweek that “in previous generations, retirement was often seen as a distinct, full-stop event—people worked until a certain age and then exited the workforce entirely.”
Today, however, more retirees are choosing a phased strategy, in which they gradually reduce their work hours rather than leaving immediately. This transition is mostly driven by a combination of financial demands, improved life expectancy, and a desire to remain mentally and socially active for an extended period.”
His assertion was supported by a recent Greenwald Research survey for Edelman Financial Engines, which indicated that one-third of respondents feel they will never be able to fully retire and will have to work at least part-time in their later years.
The Pew Research Center also included a dismal truth in their 2023 report: around one in every five Americans aged 65 and older were still employed in 2023—nearly twice as many as 35 years ago.
The Motley Fool, a financial consulting business, conducted a poll of 2,000 American retirees, which was the highlight of this series of polls. They addressed the question shortly after the announcement of the 2025 2.5 percent cost of living adjustment for Social Security payments, and they discovered that 50 percent are considering returning to work owing to a shortage of funds.
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