BlackRock finds growing gap between retirement confidence and reality

Most retirement savers feel confident about their financial futures. Whether that confidence is warranted is another question.

According to BlackRock’s latest Read on Retirement survey, 68% of workplace retirement plan participants say they feel on track for retirement. Employers are similarly optimistic, with 66% saying workers appear to be on course to meet their retirement goals.

But a closer look at participants’ savings behavior suggests that confidence and readiness may not be the same thing.

BlackRock’s analysis found that workplace retirement plan balances are projected to replace only about 50% to 60% of the retirement income participants expect their savings to provide. The findings point to a significant gap between what workers believe their plans will deliver and what current savings patterns indicate they are likely to receive.

Read more: The real challenge in retirement isn’t saving — it’s spending

“Confidence is growing, but for too many Americans, retirement reality won’t match retirement expectations,” said Jaime Magyera, head of retirement and head of U.S. wealth advisory at BlackRock.

The disconnect appears across generations.

Among Gen Z participants, 76% said they feel on track for retirement yet BlackRock projects their retirement plans will provide about 58% of the annual income they expect from those savings. Millennials reported similarly high confidence levels, with 73% feeling on track, while projected savings would cover roughly 54% of their expected retirement income. For Gen X participants, confidence dropped to 60%, and projected savings were expected to cover only about half of the income they anticipate receiving from their plans.

The survey suggests many Americans recognize the challenge. Participants said they believe they need to save 15% of their pay for retirement but are currently contributing just 10% on average. More than half also indicated they may need to reduce contributions because of mounting financial pressures and competing priorities.

As a result, workers are increasingly looking beyond traditional retirement saving strategies.

BlackRock found growing interest in tools designed to move retirement outcomes, including active management, private market investments and guaranteed income solutions. The survey also found that 81% of participants want more personalized retirement guidance.

Technology may play an increasing role in delivering that support. According to the survey, one in four plan sponsors are already using AI-generated financial guidance, highlighting the growing role artificial intelligence could play in helping workers make retirement planning decisions. On the plan participant side, 53% said they are interested in AI-assisted retirement guidance.

Read more: How AI has gone mainstream with ultra-high-net-worth investors

The findings paint a picture of a retirement system where confidence remains high, but readiness remains a work in progress. While many Americans believe they are on track, BlackRock’s projections suggest that closing the gap between expectations and reality may require higher savings rates, more personalized guidance and broader adoption of new retirement planning tools.