Faced with inflation, taxes and concerns over the size of Social Security benefits, most Americans are more afraid of going broke in retirement than they are of death.
That’s according to a new study from Allianz Life that surveyed 1,000 U.S. adults aged 25 years and older with annual incomes of $50,000 and above. In total, 64% of respondents across generations said they are more stressed about running out of funds in their golden years than the prospect of death.
“It’s much higher right now than it has been for quite a while,” said Kelly LaVigne, VP of consumer insights at Allianz Life. The company has been polling people on the question of whether dying or running out of money worries them more since 2022.
Americans say they need $1.26 million to finance a comfortable retirement, according to a recent study by Northwestern Mutual. That’s $200,000 lower than last year’s estimate, but still a far cry from the median amount of $87,000 people have saved in their retirement accounts, according to Federal Reserve Board’s Survey of Consumer Finances.
Among the different age groups, Gen Xers, for whom retirement is fast approaching, are the most concerned about running out of money before they die. Seventy percent of the age group expressed concern, followed by 61% of boomers. Ages 61 to 79, boomers are already in their retirement era, while Gen Xers, ages 45 to 60, will be the next generation to retire.
“Certainly for boomers who are already in retirement, inflation is a big deal because you only have a certain amount of money that you’re going to have for the rest of your life,” said LaVigne.
Tough time to save money
Though Inflation rates have eased since peaking in June 2022, the cost of basic living expenses is still rising, making it difficult for Americans to sock away extra savings. Over 50% of those surveyed by Allianz said high inflation contributed to their fear of running out of money in retirement.
Other factors contributing to Americans’ fears include high taxes and concern over whether monthly Social Security payments will provide them with enough financial support. For the average American, Social Security benefits typically replaces about 40% of their income, LaVigne said.
Recent shake-ups at the Social Security Administration carried out by the Trump Administration’s Department of Government Efficiency, or DOGE, have also stoked fears about the stability of the government agency.
LaVigne’s advice for distressed savers: Don’t let fear stop you from seeking help. “You really want to make sure that you’re working with a professional to help you get through the times like this, where there’s a lot of uncertainty,” he said.
