We’ve reached the peak of Peak 65—as an average of 11,400 Americans are turning 65 every day in 2025, according to the Alliance for Lifetime Income.
That means 4.18 million people will reach the traditional retirement age in a single year—which is the highest ever on record. It is the absolute peak of “America’s Peak 65 Zone,” a 4-year period that began last year and runs through 2027, according to a pioneering research report by Jason Fichtner, Executive Director of the Alliance’s Retirement Income Institute and a former Chief Economist in the Social Security Administration.
“We should use this time as an opportunity to apply retirement readiness lessons that can benefit future generations,” said Fichtner, author of two studies that form the foundation for the Peak 65 phenomenon and highlight the risks facing current and future generations of retiring Americans.
“For those who are 20 years away from retirement, this is a great time to assess what went right and wrong for Boomers, so when our next Peak 65 moment occurs about 20 years from now, more Gen-Xers and following generations will retire more financially secure,” Fichtner said. “There is still plenty of time for course-correcting, even for Gen-Xers who will be retiring over the next 20 years.”
Determining the need for course correction is underscored by the challenges confronting millions of Baby Boomers in retirement, according to two recent studies from the Alliance.
A definitive study on the widespread economic impact of Peak 65 by Robert J. Shapiro, former Under Secretary of Commerce for Economic Affairs, and commissioned by the Alliance’s Retirement Income Institute, indicates more than half (52.5%) of the Baby Boomers turning 65 between 2024 and 2030 have assets of $250,000 or less. Given the likelihood of living 20 or more years in retirement, they will likely exhaust their retirement savings and be forced to rely mainly on Social Security, which was designed to replace about 40% of a person’s annual pre-retirement income, on average.
Similarly, the Alliance’s most recent annual Protected Retirement Income & Planning survey of consumers ages 61 to 65 shows over half (51%) have investable household assets of less than $100,000.
Key lessons
In a press release today, the Alliance listed some key retirement-readiness lessons from Baby Boomers. Among them?
• The need to get help early, as saving early and steadily throughout a working career, coupled with professional advice for developing a retirement plan, can make a huge difference in retirement readiness.
• The need to understand financial terms. For example, an important term for retirement readiness is “protected income.” This is income that can continue throughout the rest of your life without fear of disappearing and is increasingly important as people are living longer lives in retirement. There are only three forms of protected income available to Americans: Social Security, Pensions, and Annuities. Yet research shows most people still have no idea what protected income is. ALI’s surveys of financial advisors and investors show both groups think the other is not hearing or understanding what they are saying, which is in part a reflection of not understanding the terminology being used.
• Wait to claim Social Security. The Alliance’s PRIP study found 49% of Boomers aged 61 to 65 have already started claiming Social Security Benefits. Since full retirement benefits are not available to people now until they are 67 years old, this means many people are tapping into their benefits at reduced levels and they will stay at that level for the rest of their lives. By waiting until age 70 to claim benefits, a person can add 24% to their annual earnings forever. Early claiming costs people thousands of dollars every year.
“If we concentrate on these three areas—getting people comfortable with seeking professional advice, learning and understanding some of the basic financial terms and concepts, and, if possible, maximizing Social Security benefits by not claiming early, we will go a long way in improving our retirement readiness,” said Cyrus Bamji, Chief Strategy Officer for the Alliance for Lifetime Income. “Gen-Xers and even younger Peak 65 Boomers still have the runway to plan and ensure they’ll have enough protected income to maintain the lifestyle they want in retirement.”
The release went on to note that Congress, via the SECURE Act and SECURE 2.0, has enabled private sector employers to allow their employees to transition some of their investments from 401(k) funds into annuities, which allows people to create their own form of a personal pension for retirement. The Alliance said not many employers are providing this option to their employees, however, and greater adoption of this annuity option could allow younger generations to generate personal pensions.
“Congress has done its part in creating options for employers to help employees build private pensions through their workplace retirement investment plans. Now it’s time for employers to give workers those options to help protect their retirements,” Fichtner said.
The Alliance for Lifetime Income (ALI) is a non-profit, 501(c)(6) consumer education organization based in Washington, D.C., that educates Americans about the value and importance of having protected income in retirement.
SEE ALSO:
• Employers Worried About Recruitment as ‘Peak 65’ Boomers Retire
• ‘Peak 65’ Women Face Retirement Risks
• ‘Peak 65’ is Here, and Findings Suggest Annuities Can Protect Income