Shocking Retirement Statistics in 2023

Research Summary: Retirement is an important life event that signifies the end of active employment and the beginning of a period of rest, leisure, and reduced job commitments. It is a period when most people leave the workforce to enjoy the results of their labor, pursue personal hobbies, and spend more time with family and friends. Nowadays, news headlines about retirement are all too ubiquitous, though they aren’t always as upbeat as we’d like. Retirement can bring about a variety of emotional and psychological changes. Some people may experience a loss or an identity crisis as they leave their professional responsibilities. To successfully navigate this adjustment phase, retaining social relationships, engaging in rewarding activities, and seeking help is critical.

• 42% of those aged 18 to 29 have no retirement savings, compared to 13% of those aged 60 and up.
• Even if some people continued to work in some capacity, 27% of people in 2022 considered themselves to be retired.
• Even though Social Security was the most common source of retirement income, 79% of seniors had one or more private income streams.
• 28% of retirees rely on a company-sponsored pension plan.
• Due to high inflation, one-quarter of Americans will have to postpone retirement.
• Four out of every ten women who have married once have at least $100,000 in retirement savings.
• 69% of private-sector employees had access to employer-sponsored retirement plans.
• In 2022, 79% of all retirees reported doing well financially.
• Gen Z and Millenial generations plan to retire before the age of 60, with Gen Zers aiming for 59.4 and 59.5, respectively.

General Retirement Statistics

Retirement is a momentous life event representing a transition from the hectic world of labor to a new phase of leisure, self-discovery, and contentment. It is a moment when people may finally say goodbye to the daily grind and enjoy the freedom to pursue their passions, spend quality time with loved ones, and embark on long-awaited travels.

Retirement allows one to reflect on past accomplishments, create new goals, and enjoy the fruits of years of hard work. It is a chapter full of potential and the opportunity to enjoy the results of a lifetime’s work. Here are some general data concerning retirement:

Only 36% of US adults believe their retirement planning is on track, while a fifth have no retirement funds.

While these challenges have caused some retirement organizations to combine or quit, there is a hidden potential. This number indicates that too many indicators indicate the public is unprepared.

Health issues, the necessity to care for family, or a lack of work all contributed to the date of their retirement, according to 45% of retirees. 

Most retirees reported that their decision was influenced by a desire to do other activities, spend time with family, or attain a regular retirement age. However, life events have influenced the timing of retirement for a significant proportion of those who retired in 2020 and stated that pandemic-related circumstances influenced their decision.

42% of those between 18 and 29 have no retirement funds, compared to 13% of those over 60. 

The more extensive the path to retirement, the more challenging it is to apply for and maintain individuals in a retirement plan. By recognizing the reasons for non-participation and extending benefits to better meet the needs of a more diverse population, providers can help younger participants get on the path and remain on it.

Although Social Security remained the most prevalent source of retirement income, 79% of seniors had one or more private income streams. 

It comprised 56% of retirees with pension income, 42% with interest, dividends, or rental income, and 32% with labor income. 78% of retirees received Social Security benefits in the previous 12 months, including 92% of seniors 65 and older.

Even if some were still working in some form, 27% of people in 2022 regarded themselves to be retired. 

Retirees account for a sizable proportion of the adult population. Thirteen percent of retirees worked for money or profit in the previous month. As a result, 4% of all individuals declared themselves retired but were still working. Part-time employment was more common among retirees than full-time employment.

In April 2020, 48.8% of all respondents stated they planned to increase their “emergency fund.” 

When asked which methods they were considering to enhance their finances following retirement, nearly half of those polled said they planned to raise funds; however, it was unclear where these funds would come from.

Only 47% of disabled people who aren’t retired had retirement funds. 

Disability-related non-retirees had a lower likelihood of saving for retirement and believing that their finances were on track. 13 % of them thought they were on track with their funds. Compared to adults without disabilities, those with disabilities have a lower employment rate.

18% of retirees with a bachelor’s degree or above reported continuing to work, compared to 9% with a high school diploma or less. 

More educated retirees were more inclined to work in retirement. As a result, 4% of all individuals declared themselves retired but were still working. Retirees prefer part-time work (10%) rather than full-time jobs (3%).

43% of nonretired persons anticipate a financially secure retirement. 

Nonretired Americans’ anticipation of a comfortable retirement fell 10% lower in 2021 compared to the 2012 data. According to 2021 research, 43% of non-retirees believe they will have sufficient funds to live comfortably, while a consistent 77% of retirees believe they do now.

28% of retirees say that they depend on a work-sponsored pension plan. 

This percentage is 7% lower than the 2022 data, possibly due to the several notable changes in retirement income sources. The percentage of retirees who rely on pensions or insurance plans as their primary source of income is 5% lower than the 2022 data.

92% of retirees age 65 and up rely on Social Security as the primary source of their retirement funds. 

Most retirees are reasonably expected to utilize Social Security as a source of retirement income, 78% of the overall retirees and 92% of those over 65. It is essential to remember that Social Security benefits are intended to replace 40% of your annual salary in retirement, which is why saving and investing for retirement is crucial.

43.45% of respondents to an April 2020 survey reported having less than $100,000 in their retirement portfolios. 

The majority of retirees do not have extensive retirement portfolios. The initial survey conducted in March 2020 revealed that 26.48% of seniors have less than $100,000 in their retirement accounts, and the following month, the percentage increased to 43.0%.

One-quarter of Americans will have to postpone retirement due to excessive inflation. 

Rent, groceries, and gasoline are among the items that have seen price increases due to inflation. As a result, according to the BMO Real Financial Progress Index, a quarterly poll conducted in 2022, one-quarter of Americans will have to postpone retirement. According to the survey, 36% of respondents have cut their savings, and 21% are putting aside less for retirement to keep up with rising costs.

According to a 2022 survey, 7 out of 10 employees intend to work for pay in retirement. 

This figure contrasts with only 27% of retirees reporting that they had worked for compensation in retirement. In reality, the RCS has consistently discovered that workers are significantly more likely than retirees to plan to work for compensation in retirement. This is comparable to the 2021 values of 72% and 30%, respectively.

Gender-Related Retirement Statistics

Gender-related retirement is an essential part of retirement planning because it acknowledges the various experiences and problems people confront based on gender. Women have historically faced unique challenges, including income disparities, job interruptions owing to caregiving responsibilities, and longer life expectancies, all of which influence their retirement plans and strategy.

Understanding these gender discrepancies is critical for designing equitable retirement policies and approaches to financial planning. We may strive for a more inclusive and fair retirement landscape by tackling gender-related retirement challenges, ensuring everyone can live a secure and rewarding post-work life.

On average, women retire two years earlier than men. 

The average retirement age for women is 62.1, while the average retirement age for men is 64.7.

39% of employed men intend to retire at or before age 61, compared to 32% of employed women. 

On average, males are slightly more likely than women to plan early retirement. Although working women are less likely to specify a specific retirement age, the average anticipated retirement age for men and women is approximately the same.

4 in 10 women who married once have at least $100,000 in their retirement savings. 

Any change in marital status, including marriage, divorce, and widowhood, can have enduring effects on finances and savings. 35% of previously married individuals have no retirement reserves. Compared to 60% of those who have never been married and 40% of those who have been married multiple times. compared to 2 in 10 individuals who have never married and 1 in 3 individuals who have married twice or more.

37% of male and 42% of female elderly Social Security recipients receive at least half of their income from Social Security. 

Based on Social Security Administration data, 12% of men and 15% of women seniors receive at least 90% of their income from Social Security. Having early access to Social Security payments can help these beneficiaries pay unexpected expenses without waiting an additional month.

Men (16%) are more likely than women (7%) to report working in retirement. 

The Pew survey reveals that only 12% of retired individuals work full-time (5%) or part-time (7%). Men are more likely than women to report working in retirement.

Life expectancy for men and women is 79.1 years and 73.2 years, respectively, reflecting a long-apparent, considerable disparity. 

With a few exceptions, life expectancy in the United States has been increasing: 47 years in 1900, 68 years in 1950, and approximately 79 years in 2019. However, it declined to 77 in 2020 and just over 76 in 2021. This is the most significant drop in two years since the 1920s.

Retirement Planning Statistics

Individuals nearing the conclusion of their careers should make pre-retirement planning. These plans include financial preparations like saving and investing, healthcare, estate planning, and lifestyle decisions. Individuals can ensure a smooth and rewarding transition into retirement by proactively addressing these problems, laying the groundwork for a secure and enjoyable post-work life.

As of March 2022, 69% of private sector employees have the option of retirement plans through their employers. 

69% of workers in the private sector have a link to retirement plans through their company, indicating that most employees rely on their companies to establish a retirement plan. This number significantly favors full-time workers over part-time workers.

91% of Union employees are eligible for a retirement plan.

91% of union employees had access to a retirement plan. In comparison, only 65% of non-union employees are union members. Union workers were more likely to have a choice of defined benefit retirement plans than non-union workers. It is 24% higher than the national average and 26% higher than non-union members.

79% of white-collar employees expect to continue working in some capacity after retirement, compared to 73% of blue-collar workers. 

There are no significant variations by age, income, gender, race, ethnicity, education, or region among the 77% of the currently working (and not-retired) population who anticipate doing some form of paid work after retirement.

56% of US workers said their primary financial priority was retirement savings. 

Paying off debt is the most often mentioned financial priority among workers, reported by 59% of full-time and 49% of part-time employees. Saving for retirement (56%), accumulating emergency savings (40%), supporting children (30%), and simply getting by (27%) are also frequently mentioned financial priorities. Part-time workers (33%) are significantly more likely than full-time workers (25%) to say they are just hanging by.

Among those who earn $100,000 or more annually, 44% said they’ll retire at or before age 61. 

Workers with higher family earnings are more inclined to retire early. The corresponding figure for people earning less than $30,000 is only 29%. Workers with lower income are less likely than workers who make more to state a specific age for anticipated retirement; among those who do, the mean variations between income categories are minor.

Workers are far more likely to expect to retire at 70 or older. Over one-quarter (29%) of workers anticipate retiring at 70 or later, or not at all, but just 7% of retirees anticipate this. 

Only 13% of workers expect to retire before 60, compared to 30% of retirees who report retiring at that age. 22% of workers aim to retire between the ages of 60 and 64, while 38% of retirees say they retired between those years. This disparity between employees’ projected retirement age and pensioners’ actual retirement age implies a significant gap between workers’ expectations and retirees’ experiences.

Post-Retirement Statistics

The post-retirement life of retirees is a period of emancipation and self-discovery. It is a period when people can let go of the restraints of work and fully embrace their passions and interests. With extra time, retirees can indulge in leisure activities, travel, spend quality time with loved ones, and volunteer and mentor in their communities. Life after retirement opens up new opportunities and allows retirees to design a satisfying and rewarding lifestyle that matches their values and objectives.

12% of retirees continue to work in retirement. 

This total includes both full-time and part-time workers. 5% continue to work full-time, while 7% continue to work part-time among the remaining 11%.

In 2022, 79% of all retirees stated they had been doing well financially. 

Although pensioners experienced high levels of financial security, this varied according to the individual’s income sources. 83% of retirees whose household income included earnings or other labor income said their financial situation was okay.

89% of retirees were confident they had sufficient funds to withstand an economic drop. 

Despite their worry, seniors remain confident they have sufficient funds to weather the market collapse caused by the COVID-19 pandemic. However, the percentage of seniors who reported being “extremely” or “very” confident decreased from 41% in March to 34% in April.

60% of employees plan to spend their retirement time traveling. 

Employees want an active retirement. Traveling is the most often mentioned retirement dream (60%), next to spending time with family and friends (55%) and pursuing hobbies (48%). More than one-third of workers (36%) are interested in doing paid work in retirement, such as starting a business (17%), pursuing another career (15%), or staying in the same sector (14%).

38% of employees are concerned about surpassing their retirement savings and assets due to deteriorating health necessitating long-term care. 

Workers’ most common retirement concerns are outliving their savings and investments (38%), decreasing health that necessitates long-term care (37%), and a possible reduction or abolition of Social Security (37%). Three-tenths of workers are concerned about potential long-term costs (31%), being unable to satisfy their family’s fundamental financial demands (30%), and cognitive decline/dementia/Alzheimer’s Disease (29%).

46% of Americans believe they will be in debt when they retire. 

Most people are accustomed to carrying debt. Another narrative is retiring in debt. Maintaining enough cash to cover recurring bills with interest is more difficult on a fixed income and adds another barrier to living comfortably. Carrying some debt in retirement isn’t always terrible, as long as the debt payment arrangements don’t impose a significant financial drain on your retirement income.

Retirement Savings Statistics

Building a substantial retirement nest egg takes disciplined saving, sensible investment selections, and a long-term outlook. When developing a retirement savings strategy, it is critical to consider issues such as inflation, market swings, and individual risk tolerance. Individuals can enjoy the peace of mind and financial security required to thrive during retirement by methodically setting away cash and utilizing growth opportunities.

For those approaching retirement (age cohort 55 to 64), the typical retirement savings account is $120,000. 

This figure will provide less than $1,000 monthly over a 15-year retirement period. Even with rising life expectancy and soaring healthcare costs, that’s not nearly enough.

Almost 6 in 10 non-retirees with self-directed retirement savings reported uncertainty about retirement decisions. 

Even though most people save for their retirement and manage these savings independently, many non-retirees struggled to save at the end of 2019, and those who did so frequently expended their savings.

The average retirement savings increased by 13% between 2020 and 2021, rising from $87,500 2020 to $98,800 in 2021. 

The pandemic has changed most retirement plans. In addition, from $950,800 in 2020 to $1,047,200 in 2021, people’s expectations for how much they’ll need to retire comfortably are rising.

The median retirement savings of Americans earning between $30,000 and $49,999 annually is $10,665. 

According to the most recent retirement savings data, the average balance of the above group is $31,546. Furthermore, Americans earning $50,000 to $74,999 annually have an average of $76,851 and a median of $32,842 in retirement savings. Finally, the average retirement savings of Americans earning $75,000 to $99,999 per year is $133,701, while the median is $65,201.

The average IRA balance in Q1 2023 was $109,000, a 5% increase from the previous quarter and pre-pandemic levels five years ago. 

For the second quarter in a row, average retirement account balances grew. The average 401(k) balance grew to $108,200, a 4% rise from the fourth quarter of 2022 and a 5% increase since 2018. The average account balance for 403(b)s grew to $97,900, up 6% from the previous quarter and 16% from 2018.

Average Retirement Account Balances

 49% of adults with children from multiple partners have no retirement savings. 

Whether or not an adult has biological children and whether or not they have children with multiple partners can have repercussions on their finances throughout their life and their retirement savings. In comparison to the 36% of adults who have children with a single partner, also known as single-partner fertility (SPF), 42% of adults do not have any children.

48% of workers believe they may retire with less than a million dollars in savings. 

Regardless of their ideal retirement, slightly more than half of consumers believe they will need a million dollars or more to retire. No single dollar amount can enable every American to retire at ease, but 55% of workers would want to retire and not have to worry about paying bills or other essentials.

Generation and Pandemic-Related Retirement Statistics

Retirement experiences differ throughout generations due to changing socioeconomic variables and cultural expectations. Traditional retirement plans and early retirement were more frequent among older generations. In contrast, newer generations confront higher life expectancies, shifting work markets, and a shift toward self-funded retirement plans. Furthermore, each generation has its own set of priorities, expectations, and financial limits.

The COVID-19 pandemic has had a significant impact on retirement planning and expectations. Due to economic uncertainty, many people endured financial failures, unpredictable markets, and postponed retirement. Remote work and internet platforms have transformed retirement lifestyles and opened new avenues.

Gen Z and the Millenial generations anticipate retiring before 60, with Gen Zers setting their sights on 59.4 and 59.5, respectively. 

The average retirement age given by millennial respondents was 59.5, while the average retirement age given by Gen Z respondents was 59.4. Both millennial and Gen Z respondents indicated that they intended to retire before the age of 60.. Baby Boomers reported an average retirement age of 68.3, whereas Gen X respondents reported a retirement age of 64.3.

27% of Gen Zers (18-24) and 28% of millennials (25-40) wish to retire before age 50. 

The most common age range for respondents to retire (25%) is 60 to 64, while younger individuals may be more keen on early retirement. While some Gen Xers (aged 41 to 55) may have passed that age, 16% believe their ideal retirement age is under 50. However, given that only 10% of retired Gen Xers think they are living their dream retirement, they may wish they had left the workforce sooner.

In an April 2020 survey, 87.5% of senior respondents said they were concerned about their retirement because of current market conditions. 

AAG surveyed two distinct groups of over 700 seniors aged 60 and above in March and April 2020 to assess the economic impact of COVID-19 on their lives and retirement plans. 149 respondents (20.19%) are extremely concerned, while 154 respondents (20.87%) are quite concerned.

Due to the pandemic, more than a third of U.S. Citizens changed the age they plan to retire. 

Because of the economic effects of the pandemic, most Americans have altered the timeline of their retirement plans. 24% plan to retire later than planned, while 11% change their thoughts about retiring earlier.

22% of consumers are concerned that a stock market breakdown will cause them to lose their retirement funds. 

Many employees are also concerned about their other investments. However, the most common concern among retirees may not be entirely financial: 46% are concerned that an unexpected health issue could jeopardize their retirement plans.

Geographic Retirement Statistics

Individual preferences, financial resources, and preferred lifestyle all influence geographic retirement plans. Retirement destination selection is influenced by factors such as cost of living, climate, healthcare accessibility, cultural amenities, and proximity to family. Geographic retirement plans, whether wanting a vibrant city life, calm countryside, or an exotic locale, play an important influence in molding the total retirement experience.

The average retirement balance in Connecticut is $545,754. 

When comparing the East Coast to the West Coast, it’s evident that East Coasters are saving more for retirement. Connecticut tops the list of the top 5 average retirement savings states in 2021, with an average retirement savings of $545,754.

Utah retirees had the lowest average retirement savings in the US, with $315,160. 

The suggested retirement fund in Utah is $692,093, yet the average person falls 54% short with only $315,160. Other states in the bottom five with the lowest average retirement balances were North Dakota with $319,609, DC with $347,582, Oklahoma with $361,366, and Mississippi with $347,884.

As of May 2022, Hawaii has the highest living expenses in the United States. 

The cost of living covers all expenses toward meeting a person’s necessities, such as food, housing, healthcare, and transportation. The cost of living varies significantly from state to state, with vast metropolitan regions having the highest costs. Hawaii has a cost of living index 193.3, about twice the national average. Except for healthcare, Hawaii has the highest expenses across all categories.

In 2020, the average retirement age for those who joined the labor force at 22 in the OECD nations was 64.2 for men and 63.4 for women.

Different regulations apply to different components of the overall retirement-income package in numerous OECD nations. The usual retirement age reflects the age of eligibility for all combined plans without penalty following an entire career beginning at 22. As a result, where average retirement ages differ between pension systems, the maximum across schemes defines the country’s usual retirement age.

Iceland, Norway, and, for males alone, Israel have the highest average retirement age of 67. 

The OECD’s average regular retirement age in 2020 was 64.2 years for men and 63.4 years for women. It ranges from 49 for women and 52 for males in Turkey to 67 for men in Iceland, Norway, and Israel.

FAQs

How much money does an average American retiree have?

According to research conducted by Vanguard, the typical amount in the retirement accounts of people aged 65 and older is $279,997, while the balance in the retirement accounts of people aged 55 to 64 who are getting close to retirement is $256,244.

What Is the Average Retirement Age?

According to the findings of the 2023 Retirement Confidence Survey, a significant portion of people planning for retirement anticipate leaving the workforce at the age of 65. According to the poll’s findings, the median age for workers to retire is 62, even though the expected median retirement age is 65. The mismatch suggests that many Americans intend to remain actively employed longer than they actually do.

What is the average nest egg in retirement?

The average retirement nest fund in the United States in 2022 will be $86,869, 11% less than the previous year’s average of $98,800.

Final Thought – Retirement Statistics

With a few exceptions, older Americans who have worked longer, had longer tenures and earned higher wages have the most retirement funds. The median retirement savings for Americans between the ages of 55 and 64 is slightly higher than that for Americans over 65, because the latter are already retired and have begun to consume their resources.

In current difficult economic times, thoroughly preparing for retirement in the United States is becoming increasingly difficult. These retirement statistics confirm this, providing significant insight into the issues and challenges millions of future retirees will confront.

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