Non-Retired Americans Anxious About Retirement Planning

Many plan to make financial sacrifices in retirement, a survey finds.

Worries about health care costs and Social Security uncertainty have many Americans planning to make financial sacrifices in retirement, according to a survey conducted for the American Institute of CPAs (AICPA).

The survey found that only 46% of non-retired Americans are confident they will reach their retirement goals, compared with 49% who are not confident (29% not sure, 20% don’t think they ever will). Only 5% of non-retired Americans report they have already reached their retirement goals.

This lack of overall confidence tracks with anxiety about the financial aspects of retirement—with two-in-five non-retired Americans (42%) saying they are either very anxious (14%) or somewhat anxious (29%). When these Americans were asked the specific cause of their anxiety, health care cost (71%), health care uncertainty (68%), affording everyday expenses and bills (67%), Social Security uncertainty (62%) and uncertainty over tax rates (52%) were cited. In addition, figuring out how much money will be required in retirement (70%) and the overall difficulty of planning for retirement (54%) are causing anxiety for a substantial percentage of non-retired Americans.

Overall, non-retired Americans are more likely than those who are currently retired to plan on making at least one financial sacrifice in retirement (92% vs. 72%). Those sacrifices include:

  • Working full-time longer than expected (45% non-retired vs. 11% retired);
  • Working a part-time job (43% vs. 17%);
  • Moving to a less expensive city or town (40% vs. 22%);
  • Forgoing medical care or treatment (28% vs. 14%).
NEXT: Sources of retirement income

“Working throughout your life was once a reliable route to a comfortable, financially secure retirement. Over the years, Americans have been asked to take on more responsibility and become more self-sufficient when it comes to their retirement planning,” says Greg Anton, chair of the AICPA’s National CPA Financial Literacy Commission. “We’ve found that today, even Americans who say they’ll reach their financial goals are anticipating a more active ‘retirement-lite’ that involves working and making financial sacrifices.”

The traditional "three-legged stool" model of retirement planning involves Social Security, a pension and personal savings, including employer-sponsored defined contribution (DC) retirement plans and individual retirement accounts (IRAs). The survey found that, among those currently retired, the model holds up well, with these Americans citing Social Security (61%), pension plans (36%) or cash or savings accounts (25%) as their top sources of income in retirement.

However, for non-retired Americans, anxiety over Social Security and a sharp decrease in company pensions may have led to an increased emphasis on personal savings. Overall, for non-retired Americans, the percent who anticipate relying upon Social Security (48%) or a pension plan (17%) as one of their top two primary sources of income differs significantly, with a more likely dependence on cash or savings accounts (39%). And non-retired Americans are more than three times as likely as those who are retired to say they expect to rely upon a 401(k) (43% vs. 14%) as one of their two primary sources of income during retirement.

Harris Poll conducted the survey within the United States between March 24 and 27, 2017, among 1,018 adults (505 men and 513 women ages 18 and older) including 650 adults self-identified as “non-retired” and 322 as “retired.”