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The Retirement Crisis: Perception vs. Reality
While individuals’ needs are evolving, America’s retirement system remains quite robust — bolstered by widely available public pensions, Social Security benefits, and a defined contribution system. To get a better sense of how Americans are really feeling about retirement and whether a crisis exists, PGIM asked more than 2,200 for their views.
The survey confirms a widely held perception that “a national retirement crisis exists,” with 58% of respondents somewhat or strongly agreeing with this statement. However, when asked the top reason why they believe this, survey respondents cited “the situations of people they know” (52%) more than their own personal situation (43%), with retirement media coverage close behind (42%). Unsurprisingly, older workers are more likely to believe there is a retirement crisis than those who are already retired, as seen in the chart below.
Fewer Americans believe their retirement situation is in crisis
However, far fewer Americans would describe their own retirement situation as in crisis, with only 39% somewhat or strongly agreeing with this statement, approximately one-third feeling indifferent, and 29% disagreeing. Perceptions of a personal crisis drop notably by age, particularly among retirees, as illustrated in the chart below.
The biggest predictor of whether someone believes there is a national retirement crisis was if they viewed their own retirement situation as in crisis. For instance, of the 30% of respondents who somewhat or strongly agreed that their personal retirement situation was in crisis, the vast majority (87%) believed there was a national retirement crisis. In contrast, among those who did not describe their personal retirement as in crisis, only 40% believed there was a national crisis.
It doesn’t take much to get out of a perceived crisis in retirement
Among retired survey respondents aged 55+, 24% reported their personal retirement situation was in crisis. However, the survey suggests it doesn’t take a notable jump in investable assets for this perception to change. For example, while 48% of retiree respondents aged 55+ with no assets described their situation as a crisis, this drops to 22% for households with $10,000 to $50,000 in savings, to 11% for those with $50,000 and $100,000 in savings, and to only 3% for those with assets over $500,000. Therefore, even getting people to retirement with relatively minor savings levels (e.g., at least $50,000) would likely improve perceptions of a crisis.
Reactions from David Blanchett, PGIM DC Solutions Head of Retirement Research and Portfolio Manager:
“While I understand the perspectives and obstacles Americans face when it comes to saving for retirement, I prefer to think of the current state as a challenge, not a crisis. Access issues notwithstanding, our retirement system is one of the best in the world, and we’re making changes to increase availability of workplace retirement plans and improve behaviors among employees participating in the plan to ensure they can live a better life, longer.
“To me, the most interesting part of this survey is how an individual’s situation is related to perceptions of a national crisis. Those who describe their own situation as a crisis are nearly twice as likely to agree there is a national crisis, but many more are basing their perception on media coverage or the situations of others. It may not take much to change these perceptions — individuals with as little as $10,000 to $50,000 in retirement assets were less than half as likely to describe themselves as being in crisis.
“Overall, this study suggests there is a significant amount of nuance around perceptions of a retirement crisis particularly depending on age, income and employment status. Everyone’s path to financial security later in life is unique, and those unique needs should be considered as part of the solution to these challenges.”
ABOUT THE SURVEY
This study was conducted by Morning Consult for Prudential Financial with a nationally representative online sample of 2,203 adults, aged 18 or older, between February 26 and 28, 2024.
There are certain cohort groups that include fewer than 100 respondents, in particular when breaking out respondents by working/retired and age. For reference purposes, the table below includes the sample sizes for the groups considered for the first two graphics (age groups with fewer than 50 respondents were omitted entirely).
| Age Group | Working | Retired |
| <30 | 235 | |
| 30-39 | 317 | |
| 40-49 | 211 | |
| 50-54 | 111 | |
| 55-59 | 82 | |
| 60-64 | 56 | 74 |
| 65-69 | 52 | 127 |
| 70-74 | 118 | |
| >=75 | 105 | |
| Total | 1,064 | 424 |
For the asset threshold analysis there was no group with less than 100 respondents.
ABOUT PGIM DC SOLUTIONS
As the retirement solutions provider of PGIM, PGIM DC Solutions LLC seeks to deliver innovative defined contribution solutions founded on market-leading research and capabilities. Our highly experienced team partners with clients on customized solutions to solve for retirement income. PGIM DC Solutions aims to help investors achieve their retirement goals through their suite of PGIM RetireWell™ Solutions, which includes target date portfolios, retirement income strategies and financial wellness resources.
All investments involve risk, including the possible loss of capital. Asset allocation, diversification, dollar-cost averaging and/or rebalancing do not ensure a profit or protect against loss.
The information presented is for informational purposes only and is not intended as investment advice and is not a recommendation about managing or investing retirement savings. These materials do not take into account individual investment objectives or financial situations. These materials are for informational, illustrative and educational purposes only.
PGIM DC Solutions LLC (“PGIM DC Solutions”) is an SEC-registered investment adviser, a Delaware limited liability company, and an indirect wholly owned subsidiary of PGIM, Inc. (“PGIM”), the principal asset management business of Prudential Financial, Inc. (“PFI”) of the United States of America. PGIM DC Solutions is the retirement solutions provider of PGIM and aims to provide innovative defined contribution solutions founded on market-leading research and investment capabilities. Registration with the SEC does not imply a certain level of skill or training.
PGIM DC Solutions aims to help participants achieve their retirement goals through their suite of “PGIM RetireWell™” solutions. These solutions may include a range of investment options including target date portfolios, retirement spending strategies, and managed accounts powered by our proprietary advice engine. There is no guarantee that investment or retirement goals will be achieved. Use of the term “RetireWell” and any related phrase is not intended to indicate that such goals will be achieved.
© 2024 Prudential Financial, Inc. and its related entities. Prudential, the Rock symbol, and the PGIM logo are service marks of Prudential Financial, Inc. and its related entities, registered in many jurisdictions worldwide.
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