Most Americans Say They Can’t Count on Social Security for Retirement Income

Allianz Life study finds majority of Americans are worried about their long-term financial stability.

Key findings:

• 74% say they can’t count on Social Security benefits when planning retirement income
• 78% worry that they might not be able to afford the lifestyle they want in retirement due to the increased cost of living
• 62% would rather have their money sit in cash than endure market swings

The majority of Americans don’t think they can depend on Social Security for retirement income and worry about their long-term financial stability, according to the 2023 1Q Quarterly Market Perceptions Study* from Allianz Life Insurance Company of North America (Allianz Life).

Nearly three in four (74%) say they can’t count on Social Security benefits when planning retirement income. At the same time, 88% say it is critical to have another source of guaranteed income beyond Social Security benefits in order to have a comfortable retirement.

“Social Security benefits are often the backbone of a retirement strategy but it cannot be your entire strategy,” said Kelly LaVigne, vice president of consumer insights, Allianz Life. “A strong retirement strategy will ensure you have enough guaranteed income to cover your essential expenses. That guaranteed income can come from Social Security benefits along with other investments and protection products such as annuities.”

Americans are still cautious about investing

Fewer Americans worry about a major recession right around the corner (57%) than last year. Still, 41% say they are concerned they will be laid off because of an economic downturn in 2023.

In addition, most Americans are still very cautious about investing. More than half (63%) are keeping more money out of the market than they think they should and 62% would rather have their money sit in cash than endure market swings.

More Americans are also expressing concern about their long-term financial health. For example, 78% worry that they might not be able to afford the lifestyle they want in retirement due to the increased cost of living. This is up from 73% last quarter and 68% in 1Q 2022. Meanwhile, 66% worry that if they don’t increase their retirement savings soon, it will be too late to have a comfortable retirement.

“A strong retirement strategy will address potential risks like inflation and taxes,” LaVigne said. “You can’t prepare for everything, but you can prepare for anything – if you start preparing for retirement early.”

Gen X is worried about long-term finances

Gen Xers, people born between 1964 and 1978, are worried about their retirement and long-term financial stability.

• 43% of Gen Xers worry their employer will suspend their 401(k) match, compared to 38% of millennials (born between 1979 and 1996) and 24% of boomers (born between 1945 and 1963)
• 67% of Gen Xers say they are keeping more money out of the market than they should, compared to 66% of millennials and 54% of boomers
• 85% of Gen Xers worry that they might not be able to afford the lifestyle they want in retirement because of the increased cost of living, compared to 80% of millennials and 72% of boomers

“Gen Xers are entering into and in critical years of retirement preparation,” LaVigne said. “Many people are often in their highest earning years in their 40s and 50s and finally able to really save a significant amount of money for retirement. This is when they need to establish strategies and really focus in on how they are setting themselves up for the retirement lifestyle they want.”

*Allianz Life conducted an online survey, the 2023 1Q Quarterly Market Perceptions Study in March 2023 with a nationally representative sample of 1,005 respondents age 18+.

About Allianz Life Insurance Company of North America

Allianz Life Insurance Company of North America, one of the FORTUNE 100 Best Companies to Work For® and one of the Ethisphere World’s Most Ethical Companies®, has been keeping its promises since 1896 by helping Americans achieve their retirement income and protection goals with a variety of annuity and life insurance products. In 2021, Allianz Life provided additional value to its policyholders via distributions of more than $10.6 billion. As a leading provider of fixed index annuities, registered index-linked annuities and fixed index universal life insurance, Allianz Life is part of Allianz SE, a global leader in the financial services industry with approximately 150,000 employees in more than 70 countries. Allianz Life is a proud sponsor of Allianz Field® in St. Paul, Minnesota, home of Major League Soccer’s Minnesota United.

Guarantees are backed by the financial strength and claims-paying ability of Allianz Life Insurance Company of North America. Products are issued by Allianz Life Insurance Company of North America.

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