FREE NEWSLETTER
An article in Employee Benefits News paints a dim picture of retirement. One that may reflect the real world beyond the HumbleDollar community.
Here again we are relying on a survey so who knows how accurate, but I bet worrying and anxiety over money in retirement is not uncommon. Can you imagine retiring with no clue about the viability of your finances?
It says retirees are struggling to make their savings stretch.
According to Schroder’s 2025 U.S. Retirement Survey, retirees are increasingly concerned about their financial security once leaving the workplace.
Only 40% believe they have saved enough for retirement.
62% admit they are unsure how long their savings will last.
92% worried about inflation eroding their assets and 86% citing higher-than-expected healthcare expenses.
Not fun; 36% report that money-related anxiety is affecting their overall health, 25% have lost sleep over financial concerns, and 27% spend an hour or more each day worrying about money.
It has been reported that only 32% of U.S. households prepare a monthly budget, and of those 84% say they’ve sometimes exceeded their budget. However, a 2023 Harris poll indicated that about 74% of Americans age 18 and older have a monthly budget.
The Harris survey found that 83% of Americans say they overspend, and 84% with a budget say they exceed it. 44% say they usually use a credit card to pay for the additional purchases they make when going over budget.
I’d suggest this is a source of some of the worry reported in the main stream media (MSM). It would be reasonable for one to assume that overspending may become chronic as one ages.
Schroder’s 2025 U.S. Retirement Survey: “says retirees are struggling to make their savings stretch.” And “92% worried about inflation eroding their assets and 86% citing higher-than-expected healthcare expenses.” These are areas the policy makers may provide help, but it will never occur given the amount of denial and apathy in Congress.
Interestingly, there is a wide divide about priorities in the electorate. Only 39% of Democrats, 52% of independents and 62% of Republicans saw inflation as a priority issue in a poll taken in 2024.
To be honest, I don’t stress about money every day, but ever since starting my FIRE journey, it’s always in the back of my mind. I’ve become much more intentional about how I spend, knowing that every choice can bring me closer to my financial goals. Not sure if that counts, but it’s definitely a shift in mindset.
Considering what the median amount is that people have saved for retirement I am not surprised. The median social security amount a month isn’t enough for anything but a very basic lifestyle where you are one car repair away from disaster.
Back when I was teaching college student (mostly traditional age) one of them said that everyone needed to retire at 40 to give young people a chance. I immediately said that was a great idea; I’d enjoy 50 or 60 years of retirement at their expense. Most of the class laughed or looked horrified at the thought.
I have found that younger people have trouble imagining their future. Part of that has to do with the fact that one’s frontal lobe doesn’t fully develop until you are about 30 (helps you anticipate long term consequences of current choices) and part of it, I think, has to do with having a great deal of trouble imagining themselves as, for example retired and what that entails.
Because of that I had one of their projects be to talk to someone in retirement, 5 years out from it, and 10 years out from it and ask them a number of questions, including what they’d advise younger people to do with respect to having enough for retirement. I then had them write about if anything anyone said affected their thoughts on how they’d plan for retirement, what their plans will be, and what the HR department of companies should do because of what they learned from whom they talked with (it was an intro to management class; they also had to add some business journal articles on the subject too). Most of the students found this eye opening and many thanked me for that assignment.
I think people have trouble planning because we don’t make this part of every day life from when people are young that we talk about. My parents used to hate that I worked in outdoor adventure (paid below minimum wage due to giving us room and board). I loved it because I got to work in a number of states and countries. They told me I’d regret it when I was retired (eg bring down my income average for social security). I shrugged them off because I couldn’t afford to travel without working in other countries.
Of course as I was older (and I did change my career at 40ish because of this) I realized what they said was true – oops. That meant I had to be incredibly frugal to “catch up” in what I had in my retirement accounts. I also waited until 70 to take social security as I needed the higher amount (I could have used it sooner due to career wrecking cancers).
I think we need to figure out how to get younger people understand the reality of retirement, decisions that need to be made when they are younger (like my students learned with their class assignment), and not ignore how difficult it is for younger people to actually imagine what their reality could be given different decisions they make now with respect to retirement.
I believe this is the most visible result of moving from pensions to 401k as the major source of retirement. By transferring the risk from the company to the retiree, the worry began. Yes, I complain about the price of groceries and health care, but only because I have a memory what they cost years ago.