Nearly half of Americans say they feel financially prepared for retirement, but a closer look shows a wide gap between confidence and reality — particularly among younger workers.
Empower’s latest “Retirement Readiness Snapshot” found that most respondents are unsure how they will fund their later years. The findings highlight a mix of cautious optimism and lingering concern about inflation, health care costs and long-term savings.
Many people are reluctant to take the first step towards saving and investing because they feel intimidated. Some think they do not have enough financial know-how and fear losing money.
The data also shows a generational divide. While 55% of Baby Boomers feel prepared for retirement, only 32% of Gen Z adults say the same. The gap underscores how younger workers may be struggling to get started or are unsure how much they need to save.
At the same time, Americans are relying on a mix of income sources to fund retirement. About 72% expect to depend on Social Security, but more than half (55%) say personal savings, including 401(k) plans and IRAs, will play a major role. Another 27% plan to rely on passive income streams like dividends or annuities.
That shift toward personal savings places more responsibility on individuals to plan and invest wisely.
Retirement timing and investing
About 45% of respondents said they plan to retire between ages 60 and 69.
13% expect to work beyond age 70.
22% said they don’t know when they will retire.
That uncertainty can make planning more difficult, particularly when combined with economic pressures such as inflation.
Nearly eight in 10 Americans (78%) worry about how rising prices will affect their retirement savings. Health care costs are another concern, with 12% citing them as their biggest financial worry.
When it comes to investing retirement funds, most Americans are taking a measured approach. According to the survey:
About 38% prefer a balanced, moderate-risk strategy.
19% favor low-risk investments.
7% are willing to take on high risk in pursuit of higher returns.
Steps to improve retirement readiness
For those who feel behind, the report outlines practical steps that can help strengthen retirement security:
Start saving as early as possible to take advantage of compound interest.
Contribute consistently to retirement accounts like 401(k)s and IRAs and take advantage of employer-matching benefits.
Join employer-sponsored financial education programs.
Diversify investments across stocks, bonds and other assets.
Consider passive income options such as annuities or stocks.
Revisit your plan regularly and adjust based on life changes like marriage or having children.
The bottom line
The snapshot makes one point clear: While many Americans feel somewhat prepared, many have significant work to do.
Building a secure retirement does not happen overnight. It requires steady saving, thoughtful investing and a willingness to adapt as financial conditions change. For those who haven’t started, the most important step may simply be to begin by calling us.