Northwestern Mutual exposes retirement confidence crisis

The price tag on a comfortable retirement keeps climbing, and a growing number of Americans are struggling to keep up with the target.

Northwestern Mutual released its 2026 Planning & Progress Study in April, revealing that the average retirement savings goal has surged to $1.46 million. That figure is a $200,000 jump from the prior year.

The rising target tells only part of the story, because nearly half of all adults surveyed believe they could outlive their retirement savings entirely. Almost half (46%) of respondents said they do not expect to be financially prepared for retirement, the study found.

Retirement savings expectations jumped by $200,000 in a single year

The $1.46 million figure marks a return to 2024 levels after dipping to $1.26 million in 2025, according to the 2026 Planning & Progress Study. John Roberts, chief field officer at Northwestern Mutual, attributed the increase to persistent inflation, longer lifespans, and uncertainty around Social Security.

That combination of pressures is not limited to a single income bracket or age group within the broader population of working Americans. Wealthy respondents with more than $1 million in investable assets said they would need an average of $2.67 million to retire on their terms, the study said.

Retirement is increasingly complex, and Americans are responding by setting higher expectations for what they’ll need.

“What matters now is pairing those expectations with a thoughtful, comprehensive financial plan that will enable them to reach their unique goals,” Roberts added.

Research from the Employee Benefit Research Institute reinforced those findings, showing that worker confidence in retirement readiness fell to 61% in 2026, while retiree confidence slipped to 73%.

Worker confidence fell six percentage points from 2025 to reach its lowest level since 2017, the EBRI survey found. Retiree confidence dropped five percentage points over the same period, to 73%.

The Harris Poll conducted the Northwestern Mutual study online between Jan. 5 and Jan. 21, 2026, among 4,375 U.S. adults aged 18 and older. The EBRI/Greenwald Research survey was conducted online from Jan. 2 through Jan. 28, 2026, among 2,544 Americans aged 25 and older.

Gen X faces the steepest retirement readiness challenge

Among all generations, Gen X stands out as the group closest to retirement with some of the weakest confidence in its financial preparedness. Roughly 49% of Gen X respondents reported having at least four times their current annual income saved, up from 41% one year earlier.

That improvement sounds encouraging on the surface, but one in five Gen X adults said financial setbacks have already forced them to delay their retirement. Gen X members also started saving at age 32 on average, a full decade later than Gen Z respondents, who began at 22.

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Gen Z remains the most optimistic generation, with 58% expecting to be financially prepared, though that number slipped from 63% in 2025. A troubling 26% of Gen X respondents told researchers they have not started saving for retirement at all, according to the Northwestern Mutual study.

Close to a quarter of all Americans with retirement savings reported having just one year or less of annual income set aside for retirement. That statistic underscores how many workers across age groups are entering their later working years without a meaningful financial cushion.

Gen X nears retirement amid growing financial pressure, as delayed savings and setbacks leave millions questioning their long-term readiness and stability.

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Fear of outliving savings is gripping nearly half of all Americans

The prospect of exhausting retirement funds is no longer a concern limited to a small group of financially stressed adults in the United States. A total of 48% of survey respondents said they believe it is somewhat or very likely that they will run out of savings before they die.

That concern runs deepest among Millennials at 55% and Gen X at 50%, two cohorts with potentially decades of retirement spending ahead of them. More than a quarter of all Americans (27%) believe they will live to 100, which adds pressure on long-term savings plans.

Kelly LaVigne, vice president of consumer insights at Allianz Life, warned that rising costs and economic uncertainty leave many Americans questioning the longevity of their savings.

Allianz Life’s 2026 Annual Retirement Study, released April 23, 2026, found that 67% of Americans now fear running out of money more than dying.

Despite these fears, more than a third of respondents admitted they have taken no concrete steps to address the possibility of outliving their savings. That inaction highlights what researchers describe as a gap between awareness of the risk and concrete steps to address it.

Working in retirement and the advisor advantage reshape planning

Four in 10 Americans now say they plan to work during their retirement years, and that number rises to 50% among Millennials and Gen X. The motivations extend beyond financial need, with 56% of respondents citing a desire to continue feeling useful and intellectually stimulated.

“As people plan to live longer, their money needs to work longer, too,” Roberts said in the study. “Planning for longevity isn’t just about accumulating more. It’s about building a strategy that can sustain income, manage risk, and adapt over time.”

The study also revealed a striking confidence gap between Americans who work with a financial advisor and those who plan on their own. Roughly 74% of people with an advisor said they expect to be financially prepared for retirement, compared with only 43% of those without one.

Commenting on the EBRI findings, Lisa Greenwald, CEO of Greenwald Research, said the results show a clear need for more guidance, better planning tools, and solutions that help people turn savings into lasting financial security.

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