Americans Face Growing Gap Between Retirement Savings Goals and Reality

A 2026 U.S. Retirement Survey commissioned by global investment manager Schroders polled 1,500 investors nationwide—including 382 retirees—between March 20 and April 15. Respondents in workplace retirement plans overwhelmingly cited $1.2 million as the amount needed to retire comfortably. Yet 51 % expect to have less than $500,000 saved by retirement, and 24 % anticipate having under $250,000. Only 30 % believe they will reach at least $1 million, while a third expect to hit the $1 million mark. The survey identified rising living costs, credit-card debt, and competing expenses as primary obstacles, with 33 % reporting more credit-card debt than retirement savings.

Retirement’s new magic number? Workers say they’ll need $1.2 millionCNBCAmericans expect to need $1.2M to retire comfortably: survey

Earlier in 2026, Northwestern Mutual reported a higher “magic number” of $1.46 million, up $200,000 from the prior year. Schroders’ estimate of $1.2 million is a decrease from its own 2025 figure of $1.28 million, reflecting ongoing volatility in cost-of-living expectations.

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• Savings expectations: 51 % expect < $500,000; 24 % expect < $250,000.

Retirement’s new magic number? Workers say they’ll need $1.2 million

• Debt pressure: 33 % have more credit-card debt than retirement savings.

Retirement’s new magic number? Workers say they’ll need $1.2 million

• Saving ability: 55 % cannot save 10 % of paychecks; 69 % say rising costs have pushed retirement out of reach.

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• Investment allocation (among those who know their holdings): 27 % equities, 26 % cash, 17 % fixed income, 12 % target-date funds, 12 % private equity/credit, 12 % other.

Retirement’s new magic number? Workers say they’ll need $1.2 million

• Behavioral shifts: 27 % reduced plan contributions, with 70 % of those cuts occurring in the past two years; another 27 % borrowed from retirement accounts, primarily for debt repayment and emergency expenses.

Retirement’s new magic number? Workers say they’ll need $1.2 million

• Confidence: 81 % are at least somewhat worried about outliving their savings.

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The disparity between perceived retirement needs and projected savings amplifies financial insecurity for a generation facing higher healthcare, housing, insurance, and utility costs. Heavy cash allocations—nearly matching equity holdings—suggest a risk-averse stance that may limit growth potential, especially for workers with retirement horizons beyond five years. Employers, as plan sponsors, are positioned to influence outcomes by addressing broader financial challenges alongside retirement education.

Retirement’s new magic number? Workers say they’ll need $1.2 million

Schroders’ head of U.S. defined contribution, Deb Boyden, emphasized that investors are “struggling to turn good intentions into long-term retirement readiness” and noted that “concerns about market volatility and downturns are understandable given the current macro backdrop.” She added that employers can improve retirement readiness by tackling broader financial pressures. Certified financial planner Douglas Boneparth advised individuals to shift focus from a single savings target to consistent habit formation, stressing that “someone who saves consistently, works to reduce high-interest debt and invests early can close more ground than they think.” He also highlighted that the suitability of a $1 million benchmark varies by location, lifestyle, and retirement timing.

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Boneparth cautioned that chasing a specific dollar figure can be misleading, arguing that “it depends” on personal circumstances. He warned that holding a large cash portion “comes with a significant opportunity cost” for investors not nearing retirement, suggesting that a more diversified approach may better serve long-term goals.

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The survey’s $1.2 million target contrasts with Northwestern Mutual’s $1.46 million estimate, illustrating divergent benchmarks across industry studies. Additionally, 24 % of participants indicated they do not know how their retirement assets are allocated, revealing a knowledge gap that could affect investment decisions.

Retirement’s new magic number? Workers say they’ll need $1.2 million

• “Many investors are just struggling to turn their good intentions into long-term retirement readiness,” — Deb Boyden, Head of U.S. Defined Contribution, Schroders

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• “It's hard to save for a future that feels abstract when the present feels urgent,” — Douglas Boneparth, Certified Financial Planner, Bone Fide Wealth

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• “Rising costs are forcing tough tradeoffs, and saving for retirement is often the first thing that gets deprioritized,” — Deb Boyden, Schroders

Retirement’s new magic number? Workers say they’ll need $1.2 million

• “You may need more or significantly less,” — Douglas Boneparth, Bone Fide Wealth

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• “For investors who are not planning to retire in the next five years, holding one-quarter of your savings in cash comes with a significant opportunity cost,” — Deb Boyden, Schroders

Americans expect to need $1.2M to retire comfortably: survey

• “It depends.” — Douglas Boneparth, Bone Fide Wealth

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