Retirement Delayed as Workers Tap Savings, Cut 401(k) Contributions
Economic uncertainty is quietly reshaping how—and when—Americans retire, with new research out today showing the finish line moving further out of reach for millions of workers.
A report from Economist Enterprise, supported by Nuveen, a TIAA company, finds employees now expect to retire nearly 4 years later than planned on average, driven less by choice than by the rising cost of living and anticipated healthcare expenses.
“The data in this report should give every employer pause. When workers feel financially insecure, they delay retirement, and that has real costs…”
Nuveen’s Brendan McCarthy
At the same time, an increasing number of workers are tapping into the very savings meant to support them in retirement. More than a third (35%) report having taken hardship withdrawals or loans from their retirement accounts, showing that short-term financial strain is forcing problematic trade-offs. Then consider that nearly one in three workers say they’ve reduced their 401(k) contributions, and taken together the picture becomes clearer as to why many Americans feel they need to delay retirement by multiple years.
“The data in this report should give every employer pause. When workers feel financially insecure, they delay retirement, and that has real costs—both administrative and financial—for organizations carrying expensive, experienced employees who are ready to move on but don’t believe they can afford to,” said Brendan McCarthy, head of Nuveen Retirement Investing. “Employers have more power to change that than they might realize. At a time when employees are craving stability and certainty, employers can stand out as an employer of choice by delivering a more modern approach to benefits that can help employees navigate key life milestones with more confidence.”
Retirement a moving target
The employee benefits-focused research released today by Economist Enterprise surveyed 2,063 full-time employed Americans aged 18-62, providing insights across industries including energy and utilities, manufacturing, sports, media and entertainment, financial services and insurance, and government.
Concerning retirement, the research found most people are working longer out of necessity. Of those who expect to work past their ideal retirement age, only 20% cite job satisfaction as the primary reason. Instead, rising living costs (47%) and healthcare expenses (41%—rising to 50% among low-income workers) are the primary drivers of expected delays.
Lower-income workers expect the largest gap, anticipating retiring roughly 6 years later than their ideal age. Even Gen Z—many of whom just entered the workforce full-time—expect retirement to be delayed beyond ideal age by an average of 5 years.
The research shows retirement delays hit finance and manufacturing hardest. Workers in financial services and insurance expect the longest delay (5.1 years), followed by manufacturing (4.5 years). Government workers anticipate the shortest gap between ideal and expected retirement (2.9 years).
Raiding savings, delaying purchases
To cope with financial pressures, the research found workers aren’t just adjusting their expectations—they’re pulling from retirement savings and deferring major life milestones to stay afloat today.
About one-third of workers (35%) have, at some point, taken hardship withdrawals or loans from retirement accounts. Rates are highest in financial services and insurance (44%) and manufacturing (41%), and lowest among government workers (23%).
Thirty percent of workers say they have cut back retirement savings rates, rising to 36% among high-income workers. Three-quarters (73%) say they have postponed buying a home or car, with Millennials most affected (82%). Delayed purchases are highest in manufacturing (79%) and lowest among government workers (69%).
Forty-three percent of workers say they have delayed or skipped medical care to avoid costs—rising to 51% in manufacturing and financial services—while one in four (25%) have postponed having children.
Last week, Dayforce’s 2026 State of Retirement Savings report also found a workforce pulling back on saving for retirement after years of making progress. More than one in four workers (26%) who have actively saved for retirement reduced their individual contributions last year.
The Dayforce report found retirement savings rates edged downward to 8.9% in 2025, the first decline in 3 years, while loan use from retirement accounts rose for the third year in a row—to 18.6% in 2025.
Staying put
Another big finding from today’s Economist Enterprise research was that America’s workers are holding onto their jobs at a decade-low quit rate of 2%, with 62% prioritizing job security over seeking out new opportunities.
Thirty percent of workers report they have stopped looking for new opportunities over the past 5 years, which rises to 35% among those in financial services and insurance and 34% in manufacturing. Government employees are less affected, with only 23% saying they have paused their job search.
“America’s workers are prioritizing job stability and a strong benefits package, signaling a shift in how workers weigh risk versus reward in today’s competitive labor market,” said Matt Terry, who led the research at Economist Enterprise. “This cautious approach reflects a broader trend: workers are increasingly valuing predictability over advancement, which could have lasting implications for career growth and economic mobility.”
SEE ALSO:
• Retirement Progress Reverses as Saving, Participation Rates Slip in 2025: Dayforce Report
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.