According to a recent Gallup survey shared with CNN, Americans’ confidence in their ability to retire comfortably has reached an 11-year low, reflecting growing economic pessimism. The survey reveals that only 43% of nonretired adults believe they will have sufficient funds to live comfortably during retirement, the lowest level since 2012. This prior year saw a decline of five percentage points in this figure, and it has decreased by ten percentage points since 2021.
The survey highlights that lower-income Americans are particularly concerned about their retirement prospects. A record-low 19% of lower-income adults anticipate living comfortably in retirement, with a record-high 88% expressing worry about having enough money to retire. Gallup suggests that non-retirees outlook typically fluctuates with the national economic climate.
Mohamed Younis, Gallup’s editor-in-chief, stated that the overall retirement numbers are “rather grim,” reflecting persistent concerns regarding the high cost of living, the security of bank accounts, and the possibility of a recession. Families find it challenging to save for retirement due to the burden of living. Younis added that despite a slow-down inflation rate, people continue to feel financial pressure.
The survey conducted from April 3 to April 25 reveals a significant gender disparity in retirement confidence. Only 36% of women expect to retire comfortably, compared to 50% of men. Additionally, the retirement outlook varies significantly based on age. While 54% of Americans aged 18 to 29 anticipate having enough money to live comfortably during retirement, only 38% of those aged 30 to 49 and 39% aged 50 to 64 share the same sentiment.
Income levels also play a crucial role in shaping Americans’ views on retirement. While only 19% of nonretired adults believe they will retire comfortably, the survey shows that 36% of middle-income adults and 65% of upper-income adults have such expectations.
Interestingly, Gallup found that retirees, unlike non-retirees, do not share the same worries about their retirement prospects. Approximately 77% of retirees state that they currently have sufficient funds to live comfortably, a figure unchanged from the previous year, despite the rising cost of living. Gallup notes that retirees have consistently held high views on living comfortably (ranging between 71% and 83%), surpassing those still awaiting retirement. This divide could be attributed, at least in part, to concerns about the financial health and future of Social Security. While 59% of retired adults consider Social Security a primary source of their retirement income, only 34% of retirees anticipate relying on it. Those still awaiting retirement expect to rely more on 401(k), IRA, and other retirement savings accounts.
The Gallup survey findings on retirement align with other indicators of consumers’ gloomy sentiment as they grapple with inflation, high borrowing costs, and recession concerns. The University of Michigan reports historically low consumer sentiment, which reached a six-month low in May. Additionally, a recent CNN poll shows that 76% of adults perceive the economy as being in poor shape, up from 71% in March.
Confidence in President Joe Biden’s ability to navigate the economy also remains low, with just 35% of adults expressing a “great deal” or “fair amount” of confidence, nearly matching the low confidence rating for former President George W. Bush in 2008.