Retirement Readiness or Death: Guess What Workers Fear More?

While the dual certainties of death and taxes have long prompted universal dread, most American workers now fear something as even more grave than the grave: retirement.

According to a recent LiveCareer survey, 61% of the 1,031 surveyed U.S. workers are more afraid of retirement (specifically, their financial readiness to retire) than death. Polled workers also said they fear retirement more than getting a divorce (64%), getting fired (54%) and falling into poor health (53%).

Of the workers surveyed, 82% said they have considered delaying their retirement due to financial reasons, and 92% are worried they will have to work longer than planned.

“It’s important for HR professionals to know that this is a major concern, but maybe not a concern that employees are vocalizing,” said Jasmine Escalera, a career expert with LiveCareer, an organization that provides job-hunting resources.

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What’s Causing These Fears?

The U.S. workforce’s retirement readiness is “abysmal” and “getting worse by the day,” said Amy Mosher, the chief people officer at isolved, a human capital management and benefits services company.

Mosher and others point to several factors as the root of this situation. Inflation is making day-to-day life more expensive for the average worker — and for many, salaries are not keeping pace. Far fewer employees are finding that workplace retirement plans will fully support them in retirement compared to workers in decades past. And, Americans — and people, in general — are living longer than they used to.

“Life expectancy is going up, which is great — we can live longer — but now we have to think, ‘Can we afford that?’” Escalera said.

“Life expectancy is going up, which is great — we can live longer — but now we have to think, ‘Can we afford that?’”
— Jasmine Escalera, LiveCareer

Just Offering a Retirement Plan Isn’t Enough

In the U.S., some states require employers to offer retirement plans, with many more states looking to follow suit. Even in states with no legal requirements, though, offering retirement benefits is generally considered best practice.

Many employers do that for their employees: Of the organizations surveyed for WorldatWork’s 2024 Total Rewards Inventory of Programs & Practices report, 92% offer a defined contribution plan with pretax deferrals such as a 401(k), while 81% offer a post-tax contribution plan such as a Roth 401(k).

Still, a significant portion of Americans do not have access to a retirement plan through their employer. In fact, one California study found that 70% of Latino workers do not have access to a workplace plan. And even among workers whose employer offers access to a retirement plan, many can’t afford to contribute, don’t know about the benefit, or do contribute but don’t know how much they have saved or how far that amount will go in retirement.

Among the same organizations surveyed by WorldatWork that overwhelmingly offer retirement plans, significantly fewer offer financial wellness benefits. In 2023, just over half (52%) offered their employees personal financial-planning services such as seminars or access to financial planners — a 17% drop from the year before. Only 28% offered debt management benefits, and only 14% offered student loan debt repayment assistance.

What this means, Mosher said, is that employers can’t solve this problem simply by throwing cash at it — namely, offering more retirement benefits or providing a higher employer match. Those benefits need to be accompanied by financial wellness benefits, education and training so employees will better understand the costs of retirement and the options available to them to help defray those costs.

“When your employees realize that at some point they’re not going to work there anymore, and you can help them with planning, that’s powerful; it gets them thinking,” Mosher said. “If we’re not talking about [retirement readiness], it’s not going to happen. Then you end up with people who are stressed out about things happening to them, things happening in the world. Why are we adding the question of what they’re going to do post-employment in their retirement years to the list?”

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