Challenges Facing American Retirement Plans

Nearly half of Americans who have not yet retired are uncertain about their ability to completely stop working. A study by financial services firm Thrivent, surveying over 2,000 Americans, highlights that 47 percent of non-retirees doubt full retirement is achievable. This reflects growing anxiety about factors like living costs, economic instability, and potential upheaval in the job market due to artificial intelligence.

Retirement Security Concerns

Inflation and housing costs increasingly impact household budgets. Traditionally, retirement meant exiting the workforce entirely by the mid-60s, but now many anticipate working beyond retirement in some form. These economic pressures contribute to the changing perception of retirement.

Financial advisor Drew Powers suggests that advances in medicine and career longevity for office workers may prompt some to continue their careers as they age. However, he warns that changes in the economic landscape have led to the diminishing middle class, making the prospect of comfortable retirement less attainable for many.

Current Financial Focus

Thrivent’s 2026 Retirement Expectations Survey reveals that roughly 58 percent of non-retirees still feel confident in retiring from their primary careers on schedule, similar to 2025 findings. Skepticism remains about retirement’s reality, with 47 percent doubtful about full retirement.

Thrivent financial adviser Jason Rogoff notes that uncertainty is perennial, but the economic and retirement-related questions are more complex now. Today, 64 percent are focused on their immediate financial situations rather than future retirement plans.

Financial expert Michael Ryan emphasizes the challenges in retirement savings, with many reducing or stopping contributions recently. Some even dip into savings early to cover current expenses, indicating tight budgets.

AI Impact

Thrivent’s survey indicates increasing concern about AI’s influence on jobs. Among non-retirees, 63 percent of Gen Z and 59 percent of millennials worry about AI-related job reductions impacting retirement prospects. Comparatively, 49 percent of Gen X and baby boomers share this concern.

Kevin Thompson, CEO of 9i Capital Group, points out potential impacts on funding for programs like Social Security and Medicare due to AI-driven reductions in payroll-contributing workers. He suggests discussions about funding models, such as broader automation taxes, may be unavoidable.

Even retirees are worried; 30 percent report AI-driven workforce changes negatively affecting their retirement, an increase from the prior year.

Future Outlook

As Congress deliberates on Social Security and retirement programs, retirement readiness remains a concern for many. While some workers remain hopeful, more anticipate needing to work during retirement due to financial needs or new perspectives on retiring.

Alex Beene, financial literacy instructor, notes that rising living costs, longer life expectancy, uncertainty about Social Security, and the disappearance of traditional pensions force workers to consider employment or supplemental income during retirement. Consequently, the U.S. economy is gradually adapting to more flexible retirement arrangements.