Retirement uncertainty cuts across generations: Transamerica

Despite differences in age, income, and work experience, American workers across four generations face common financial challenges as they save for retirement, according to new findings from the Transamerica Center for Retirement Studies in collaboration with the Transamerica Institute.

The report, titled "An Uncertain Future: Retirement Prospects of 4 Generations, highlights how Generation Z," millennials, Generation X, and baby boomers are navigating a complex savings landscape shaped by economic volatility, caregiving demands, and concerns about future job security.

The newest data analysis draws from the TCRS 25th Annual Retirement Survey, taking insights from a subsample of just over 5,400 working Americans.

Among Generation Z workers, financial stress appears to be taking a toll early. Nearly six in 10 report feeling burned out, with many juggling multiple jobs or side hustles. Despite these pressures, 76 percent are saving for retirement, with a median starting age of 20 and a reported contribution rate of 15 percent of annual pay for those in a workplace plan. Still, many are vulnerable – the median emergency savings among Gen Z workers is just $2,000, and 26 percent have already tapped into retirement funds early.

“Generation Z is already saving for retirement and they have many decades to work, save, and grow their savings,” Catherine Collinson, CEO and president of the Transamerica Institute and TCRS, in a statement unveiling the findings. “They need to continue investing in their human capital through lifelong learning, keeping their job skills up to date, and safeguarding their physical and mental health.”

Millennials, now in their late twenties to mid-forties, are emerging as the next sandwich generation, balancing the demands of work, childcare, and elder care. The majority report being impacted by debt and pandemic-related financial setbacks. While 85 percent are saving for retirement, median household savings stand at $65,000. Close to one-quarter have taken early withdrawals from retirement accounts.

Meanwhile, generation X workers, many of whom are within a decade of traditional retirement age, remain concerned about their financial readiness. Only 18 percent of those surveyed expressed strong confidence in their ability to retire comfortably. Half expect to rely on self-funded savings – including 39% looking to their 401(k)s, 403(b)s, and IRAs – as their primary source of retirement income, while 77 percent are worried about the future of Social Security. In one especially sobering finding, just one-quarter have a written financial strategy.

“For Generation X, the road to a financially secure retirement has been circuitous,” said Collinson, calling back to the '80s to '90s-era shift from pensions to 401(k) plans. “Among Generation Xers who were fortunate enough to be offered a 401(k) plan in the early years of their career, many were unaware of the importance of saving.”

Among baby boomers still in the workforce, a significant share expects to work past age 70 or never retire. While 85 percent report saving for retirement, the median household balance stands at $270,000 – far below many benchmarks for retirement readiness. Just 27 percent have a formal retirement strategy, and fewer than four in 10 have contingency plans in case of unexpected job loss or health issues.