US workers' retirement confidence is sliding from inflation and uncertainty

A pair of new reports highlight a growing gap between Americans’ financial aspirations and their current realities, as persistent inflation and economic volatility prompt many to rethink their retirement plans and savings strategies.

New York Life’s latest Wealth Watch survey finds that just over one-third of US adults – 35% – have either delayed or plan to delay retirement, with insufficient savings, inflation, and broader economic shifts cited as the main reasons.

Over half of respondents have changed their retirement strategies, focusing on paying down debt or extending their working years to achieve their goals. Yet, only 45% have factored healthcare and long-term care costs into their planning, and nearly one-third are unsure whether their savings will last throughout retirement.

Jessica Ruggles, corporate vice president of financial wellness at New York Life, said the findings underscore a disconnect between optimism and financial reality.

“Many individuals are optimistic about their future selves, but these findings highlight a significant gap between their expressed confidence and their actual financial circumstances,” Ruggles said.

She added that planning for retirement and managing decumulation is becoming more complex due to macroeconomic conditions and rising costs, and that informed guidance can help people test their assumptions and navigate evolving challenges.

The survey also shows generational differences in retirement readiness. Millennials and baby boomers are more likely to report having retirement savings than Gen Xers or Gen Zers, and 64% of millennials express at least some confidence in their ability to save adequately for retirement, compared to just half of Gen Xers.

Broader financial stress is evident as well, with 92% of Americans voicing concern about market conditions. The cost of living, rising everyday expenses, and inflation are top worries, with increased spending on essentials like groceries, gas, and utilities compared to a year ago.

Despite these pressures, 77% of adults say they are taking steps to improve their financial outlook, such as staying informed about economic trends and adjusting their personal strategies.

A separate report from Payroll Integrations points to similar anxieties among employees. According to the firm’s 2025 Employee Financial Wellness Report, 59% of workers lack confidence in their retirement plans.

More than one-third have withdrawn from their retirement funds, often to cover emergencies or manage debt, and a similar share expect to do so again within the next year. Younger workers, especially Gen Z, are most likely to tap their savings to address debt obligations (42%, vs. 6% of Millennials and 17% of Gen X).

Doug Sabella, CEO of Payroll Integrations, said, “Many employees say they don’t feel prepared to retire on their own terms within their expected timeline, which is a strong signal to companies to increase support for employees, whether through enhanced retirement plan offerings or expanded financial education.”

While 87% of employees said they contribute to a retirement plan, 36% started saving later than they wanted, and an equal number said rising costs continue to hinder consistent contributions.

All told, 59% said they are not completeley confident they can retire on time and comfortably – a state of security that would take a $1.6 million nest egg, according to one recent survey by Schwab. Millennials appear most confident in their retirement readiness, according to the Payroll Integrations survey,while Gen X and Gen Z face greater challenges in saving enough for the future.