Retirees Are More Optimistic About Retirement Than Workers, Largely Because They Know Their Numbers

Quick Read

• Retirees say they feel more confident about retirement (78%) than workers do (67%), largely because retirees have actual income figures instead of guesses.

• Only 39% of workers have figured out how much they will need in retirement, and just 46% have three months of emergency savings.

• Even retirees who feel prepared can still be hit with surprises: 38% paid more for health care than expected, and Medicare does not cover long-term care.

Retirement confidence looks very different depending on where people are in the process. In the Employee Benefit Research Institute's retirement confidence survey, 67% of workers said they are confident they will have enough money to live comfortably in retirement. Among retirees, that figure was 78%, rising from 74% in the prior year.

The difference may come down to certainty. Workers are still estimating how much they will earn, spend, save, and receive from Social Security. Retirees, by contrast, can see how their finances are actually playing out. The survey questioned 1,042 workers and 1,005 retirees, and the answers suggest that being farther along in retirement naturally changes how people view their money.

What Retirees Already Know, Workers Are Still Trying to Predict

Workers face a long list of unknowns: future income, future prices, how long they will remain employed, and the size of their Social Security benefit. Retirees have already answered most of those questions. Once monthly checks begin arriving and bills become familiar, much of the uncertainty disappears.

Social Security is a major reason. EBRI found that 94% of retirees receive Social Security, and 66% said it is a major source of income. Among workers, only 36% expect it to play that kind of role. After the 2026 cost-of-living adjustment, the typical retiree benefit is about $2,071 per month. Retirees depend on that payment, while far fewer workers expect it to be a central part of their retirement income.

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Medicare also gives retirees a clearer picture of some costs. The standard Part B premium, which covers doctor visits and outpatient care, is $202.90 in 2026, and the annual deductible is $283. Expenses often shift after work ends too, since commuting and other job-related costs disappear and budgets can be built around actual bills instead of estimates.

Why Workers Worry More

Workers are carrying more uncertainty than retirees. In the survey, 70% said they worry about having to cut back because of inflation, and 56% said health care costs are reducing how much they can save.

Emergency buffers have also weakened. A 2024 FINRA Foundation study found that 46% of adults had at least three months of expenses saved for emergencies, down from 53% in 2021. EBRI also found that only about four in 10 workers have calculated how much they may need for health care or long-term care in retirement, and not having those numbers can make confidence harder to build.

Retirees still have concerns of their own. In the EBRI survey, 79% of workers and 71% of retirees said they were worried about government changes to the retirement system. Among those who were concerned, 80% of retirees and 60% of workers feared the changes could reduce Social Security benefits. That concern matters even more for retirees, who rely more heavily on Social Security, while the 2026 Trustees Report projects the combined Social Security trust funds will run short in 2034. After that, payroll taxes would cover about 83% of scheduled benefits.

Why Confidence and Readiness Do Not Always Match

Feeling prepared does not always mean a person is fully protected. EBRI found that 38% of retirees said their health care spending was higher than they expected. Even confident retirees can be pressured by longer lifespans or by the need for long-term care, which Medicare largely does not cover. In Northwestern Mutual's 2025 study, 51% of adults said it was at least somewhat likely they would outlive their savings.

Inflation is another factor shaping retirement costs. The Social Security cost-of-living adjustment for 2027 is 3.6%, and the Labor Department's inflation measure for Americans 62 and older reached a record high in September 2026.

The confidence gap between workers and retirees may come down to knowledge. Retirees usually have a real Social Security benefit, a known monthly budget, and current savings figures. Workers are still relying on estimates for all three, which makes it harder to know where they stand.

Help Avoid These 13 Retirement Mistakes Before They Derail Your Future

One investment mistake could create big risks for your retirement. Many investors make the same critical errors: being too conservative, making big bets on “sure things,” or paying excessive fees. Any of those blunders can endanger your hard-earned savings.

Now you can learn the mistakes even experienced investors make (and ways you can sidestep them before it’s too late) with this new guide: 13 Retirement Mistakes and How to Avoid Them from Fisher Investments. (sponsor)