Inflation and debt leave four generations strained in retirement race

Nearly eight in 10 American workers say the cost of living is making it harder to save for retirement, a sobering signal for financial advisors navigating a client base stretched thin across four generations.

The finding comes from Stressed and Strained: Four Generations Strive for Retirement Security by the nonprofit Transamerica Center for Retirement Studies (TCRS) in collaboration with Transamerica Institute. The survey, conducted by The Harris Poll between September 16 and October 17, 2025, among 6,153 workers at for-profit companies, is part of TCRS's 26th Annual Transamerica Retirement Survey - one of the largest and longest-running studies of its kind.

"The U.S. retirement system is evolving, and it now places more responsibility on workers to fund their retirement than it did for prior generations," said Catherine Collinson, CEO and president of Transamerica Institute and TCRS. "Today, uncertainty surrounding Social Security's future, persistent inflation, competing priorities, and potential employment disruptions make it harder for workers to save, plan, and prepare for retirement. It is a perfect storm."

The data presents a picture that should concern advisors working with clients at every career stage: 65% of workers agree they could work until retirement and still not save enough, 73% are worried Social Security won't be available when they need it, and 41% cite outliving their savings and investments as one of their greatest retirement fears.

Median total household retirement savings across all workers stand at $78,000 - a figure that, for most, is far short of the $650,000 workers themselves estimate they'll need to feel financially secure.

The generation-by-generation breakdown

The savings gap follows a steep curve by age. Generation Z workers, who make up 19% of the current workforce, have accumulated $37,000 in median household retirement savings. Half of Gen Z workers are struggling to make ends meet, 52% maintain a side hustle, and 28% hold more than one job - financial pressures that rank paying off debt (56%) and building emergency savings (47%) ahead of retirement saving (40%). One in five Gen Z workers (22%) have already taken a hardship or early withdrawal from a 401(k) or IRA.

Millennials, the largest share of the workforce at 40%, report median retirement savings of $73,000. Nearly six in 10 (58%) say debt is interfering with their ability to save for retirement, and 44% say they would prefer not to think about retirement investing until they get closer to their target date.

Generation X - now in their mid-40s to early 60s - paints the starkest picture. Median savings sit at $113,000, and only 18% describe themselves as "very confident" they'll be able to retire comfortably. More than a third (36%) expect to retire at 70 or older, or not at all, and 53% plan to keep working into retirement.

With 77% of Gen X workers expressing concern that Social Security won't be there when they retire, this cohort is banking heavily on self-funded savings - with 49% expecting 401(k)s, IRAs, or other personal savings to be their primary retirement income source.

Baby Boomers still working carry the largest balances at $263,000 in median savings, but 55% expect to retire at 70 or older or do not plan to retire. Four in 10 (42%) expect Social Security to be their primary retirement income source, and fewer than three in 10 (28%) have a written financial plan - a gap InvestmentNews has tracked closely through recent reporting on Gen X's retirement anxiety.

An advisory gap alongside the savings gap

The report surfaces a critical disconnect that advisors are positioned to address.

While nearly six in 10 workers (59%) say they would prefer to rely on outside experts to monitor and manage their retirement savings, only 35% currently use a professional financial advisor. Workers instead lean on family and friends (35%) and financial services institutions (32%) for personal finance guidance - sources that rarely provide the structured, goal-based planning advisors deliver.

That gap has grown more consequential as early withdrawals have become common across all generations. Approximately one in five workers - including 22% of Gen Z, 20% of Millennials, and 17% of Gen X - have tapped retirement accounts early, a pattern InvestmentNews has flagged as a growing structural threat to long-term retirement readiness.

Only 27% of all workers have a written financial strategy for retirement. Among those who do have an estimate of their savings target, 44% arrived at that figure by guessing, while just 13% received it from a financial advisor - underscoring what TCRS argues is a structural failure in planning engagement.

Caregiver strain complicates the picture

One dimension of the retirement savings challenge that advisors may be underweighting: caregiving. More than one in three workers (36%) are serving or have served as unpaid caregivers during their careers, and among them, 88% made at least one work-related adjustment - from reduced hours to quitting entirely.

Thirty-five percent of caregiving workers say their financial situation has worsened as a result. For advisors building comprehensive financial plans, the caregiving variable is becoming impossible to ignore.

Employers carry responsibility too, the report argues. TCRS recommends that plan sponsors promote retirement plan loans over hardship withdrawals, offer phased retirement options, and expand support for caregiving employees - all areas where advisors working with corporate clients may find an entry point.

"Retirement security is a shared responsibility among policymakers, employers, and individuals," Collinson said. "Success depends on workers' ability to earn income, support their families, and save for the future. It also depends on the strength of Social Security and Medicare, which face long-term funding issues."

For advisors, the report's underlying message is direct: the clients most at risk are also the least likely to have sought professional help. Research on young savers and generational retirement gaps continues to highlight that early engagement makes a material difference - but only a third of workers are putting that to use.