Oct 29, 2026

Americans Plan To Retire 5 Years Later Than Current Retirees Did — Here's Why

Working Americans are planning to retire significantly later than current retirees. A recent TIAA report found that the average age at which current retirees retired is 57, while those who have yet to retire plan to do so at age 62 — and many said they will likely have to retire even later.

Here's why Americans are planning to work longer than ever.

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Why Workers Expect To Retire Later Than Current Retirees

In addition to having a later retirement age target, 52% of workers said they are likely to delay retirement, compared with just 6% of retirees who ultimately retired later than expected.

"American workers face a fundamentally different retirement landscape than their grandparents did," said Tim Pitney, head of lifetime income distribution at TIAA. "The disappearance of pensions, uncertainty around Social Security, rising healthcare costs and longer life expectancies mean that reaching a retirement 'finish line' requires accumulating more personal wealth than prior generations needed."

Current retirees benefited from more certainty through defined benefit plans that told them what they'd receive and when.

"Without that structure, workers are essentially estimating a moving target, which naturally generates lower confidence in savings amounts and retirement timelines," Pitney said.

How Career Breaks Can Delay Retirement

The report found that more than half (51%) of workers have left the job market for more than one year, with the most common reason being caring for children (17%). Those career interruptions can make it harder to retire on schedule.

"Career gaps directly erode two of the most critical retirement-building mechanisms: contributions and compounding," Pitney said. "Every year out of the workforce is a year without employer matches, 401(k) contributions and the tax-advantaged growth that comes with them."

For the 51% of U.S. adults who have left the job market for more than a year, these interruptions can translate into meaningfully lower retirement balances and the need to work longer to compensate.

Rising Costs and Longer Lifespans Are Further Delaying Retirement

A variety of factors, from caregiving demands to rising costs of living to student loan debt, have delayed wealth-building for younger retirement savers in particular, Pitney said.

"Longer life expectancies also mean people need to fund more years of retirement, which naturally encourages working longer, as many feel the need to ‘make up’ for the possibility of living to 90 or 100," Pitney added.

How Workers Can Improve Their Retirement Readiness

While many retirement challenges are outside workers' control, Pitney said several strategies can help strengthen long-term retirement readiness:

Starting to save early and consistently is the most powerful lever. Time in the market and compounding returns are difficult to replicate with later, larger contributions.
Exploring guaranteed income products like annuities to leverage insurance pooling to establish a stream of income you can’t outlive helps combat fears of inflation and longevity unknowns.
Minimizing career gap impacts by maintaining retirement contributions where possible and avoiding early withdrawals from retirement accounts are also important.
Working with a financial advisor to build a clear and specific retirement plan based on your goals is a good way to get your full financial picture and determine what you need to save for the future you envision.

This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.

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Written by

Gabrielle Olya

Edited by

Rebekah Evans