Nearly half of workers peg retirement target at $1M as anxiety climbs

Nearly half of US workers now believe they will need at least $1 million to retire comfortably, a sharp amid a widening gap between retirement expectations and savings reality.

A new report (published Dec. 15) reveals that 48% of workers set the seven-digit benchmark for retirement, up from 37% in 2024. But only 27% expect they will actually accumulate that much, highlighting a growing disconnect between optimism about the future and today’s financial behaviors.

Betterment at Work’s fifth annual Retirement Readiness Report is based on responses from more than 1,000 full-time employees and shows a trend in increased financial anxiety which has climbed steadily for five years, reaching 90% in 2025 and driven largely by inflation, credit card balances and housing costs.

However, 71% of workers say they remain at least somewhat confident they will be able to retire comfortably with this level that having held steady despite economic volatility.

“It’s striking that even as financial anxiety reaches an all-time high, Americans’ belief in their long-term financial future hasn’t faltered,” says Sarah Levy, CEO of Betterment. “That optimism is encouraging, but employers play a critical role in turning it into real progress. Companies that invest in their employees' financial wellbeing help transform confidence into concrete outcomes and create lasting value for their teams."

The report points to deep divides across age and gender with Gen Z workers the most confident about retirement prospects, with 88% expressing confidence, while also reporting the highest levels of day-to-day financial anxiety. Gen X, by contrast, is the least confident generation, with only 61% believing they will save enough, as many juggle mortgages, student loans and caregiving responsibilities. Women, meanwhile, are more likely than men to report financial instability and to consider delaying retirement.

Delaying retirement is increasingly top of mind across the workforce with 54% of respondents saying they have considered working longer because they fear their savings will fall short, with higher rates among women and Baby Boomers. Student loan debt remains a significant drag as 54% of employees say it contributes meaningfully to their financial anxiety, and 85% of borrowers said they would be more inclined to accept a job offer that included student loan repayment support.

At the same time, the survey shows tangible progress in employer-sponsored benefits. Access to 401(k) plans and matching contributions has expanded markedly over the past five years, and participation has reached a record 91%. Emergency savings programs are also more common, helping to bolster short-term resilience even as long-term concerns persist.

Betterment’s data suggest that the combination of rising expectations, persistent anxiety and improving benefits has reshaped how workers view their financial lives. Employees appear increasingly willing to separate near-term strain from long-term planning, trusting that workplace benefits and continued saving will eventually close the gap between what they think they’ll need and what they can realistically achieve.