Do Americans’ Retirement Savings Match Their Expectations?

A 2026 Planning & Progress Study by Northwestern Mutual revealed that Americans believe they will need $1.46 million to retire comfortably. It’s a somewhat remarkable figure, considering the median household retirement savings for 65- to 74-year-olds is $200,000.

Americans’ savings do not match the amount they expect to need in retirement. However, given the more modest savings most retirees have amassed, it’s surprising that a large percentage of retirees say they’re doing fine financially.

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73% of retirees

The number of retirees who report being confident that they have enough money to live comfortably throughout retirement has dropped to its lowest level in nearly a decade, primarily due to mounting debt, high home prices, and rising healthcare costs. Despite that, 73% of retirees still report being somewhat or very confident that they have enough money to see them through.

The fact that 73% of retirees feel confident about their finances is good news. The generally positive outlook contrasts with the negative expectations of those still in the workforce. According to a 2024 Gallup report, the retirement reality-versus-expectation gap has been the norm since 2002, when Gallup began collecting the data.

Doing what you can

If 73% feel fine about their current financial situation, that leaves 27% who don’t. If you don’t believe you’re going to be able to reach your goal amount in retirement savings, there are things you can do to make the most of the money you do save. They include:

Understand your expenses

Even if you’re still years away from retirement, now is the time to build a post-retirement budget. Create a line-by-line estimate of how much you’re likely to spend on everything, from housing to healthcare and travel, once you retire.

You do yourself a favor by living below your means. For example, pay off as much debt as possible, and if you already know your housing costs will be disproportionate to your post-retirement income, consider moving to a less expensive area.

Decide if you can maximize your Social Security benefits

While it may be tempting to retire the day you turn 62, consider working longer to maximize your benefits. If you’re able, here’s how working longer will impact your monthly benefits. Let’s assume that your full retirement age (FRA) is 67 and your primary insurance amount (the amount you’re due to receive at FRA) is $2,000.

• Claim at age 62: You’ll receive $1,400 (a 30% reduction)
• Claim at 67: You’ll receive the full $2,000
• Claim at 70: You’ll receive about $2,480 (roughly 24% more than you would receive at FRA)

Plan now for diverse income streams

Social Security and the amount you withdraw from a retirement account don’t have to be your only sources of income in retirement. Here are several other options:

• Pensions: If you’ve earned a pension, factor it into your retirement plan.
• Investments: Consider investing in dividend-paying stocks or bonds that provide regular, dependable income. If you’re looking for a stream of real estate-related income, you can become a landlord the old-fashioned way by purchasing property or investing in a Real Estate Investment Trust (REIT).
• Part-time work: If you’re concerned about finances in retirement, decide whether you’d like to add part-time work to your schedule. It can be anything, from tutoring to crafting or consulting.

Achieving financial comfort in retirement is about more than having a huge bank balance. It depends on smart planning.

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