Americans are more scared of going broke in retirement than they are of death, study finds

The fear of going broke in retirement is a common concern among Americans, even more so than the fear of death. A recent study conducted by Allianz Life surveyed 1,000 U.S. adults aged 25 and older with annual incomes of $50,000 or more. The results revealed that 64% of respondents across different age groups are more stressed about running out of money in retirement than they are about the prospect of death.

According to Kelly LaVigne, VP of consumer insights at Allianz Life, this concern is at an all-time high. The company has been polling people on whether they fear running out of money or dying since 2022. Americans believe they need $1.26 million to finance a comfortable retirement, as per a recent study by Northwestern Mutual. However, the median amount that people have saved in their retirement accounts is only $87,000, according to the Federal Reserve Board’s Survey of Consumer Finances.

Among different age groups, Gen Xers and boomers are the most concerned about running out of money before they die. Gen Xers, ages 45 to 60, are fast approaching retirement, with 70% expressing concern, while 61% of boomers, ages 61 to 79, are worried about the same issue.

Factors contributing to Americans’ fears include high inflation rates, high taxes, and concerns about the adequacy of monthly Social Security payments. Social Security benefits typically replace about 40% of an individual’s income. Recent changes at the Social Security Administration by the Trump Administration’s Department of Government Efficiency have also raised concerns about the agency’s stability.

LaVigne advises distressed savers not to let fear prevent them from seeking help. Working with a financial professional during uncertain times can provide guidance and support. It’s essential to ensure that you have a solid financial plan in place to secure your retirement years.

In conclusion, the fear of running out of money in retirement is a legitimate concern for many Americans. By addressing financial challenges head-on and seeking professional guidance, individuals can better navigate the uncertainties of retirement planning and ensure a more secure financial future.