Following a significant drop in retirement savings confidence in 2023, overall levels of confidence have yet to recover. But optimism about future retirement prospects are high, according to the results of the 34th annual Retirement Confidence Survey (RCS) conducted by the Employee Benefit Research Institute (EBRI).

“Overall, two-thirds of the workers and three-fourths of the retirees are very or somewhat confident about having enough money to live comfortably in retirement, which is unchanged from 2023,” said Craig Copeland, director of wealth benefits research at EBRI.

“The survey also shows that workers and retirees are confident that government programs such as Social Security and Medicare will provide benefits of equal value to today and believe they understand the Social Security program.”

Confidence in retirement is broadly similar across all recorded respondent age groups, Copeland added. But in some cases, younger workers appear more confident than their older counterparts.

“For generation specific results, baby boomers and millennials reported higher confidence in having enough money to live comfortably throughout retirement than Gen Xers,” he said.

For the 2024 edition of the survey conducted in January, the methodology included 2,521 Americans — 1,255 active workers and 1,266 retirees. All responses were recorded online, and most respondents said they expect Social Security to be their primary source of income in retirement.

But Americans also expect to work for pay in retirement, despite an intention to claim Social Security benefits as soon as they are able. 

Overall retirement confidence has yet to return to levels recorded before 2023, but signs are emerging that there is some positive recovery, the results indicated.

“Sixty-eight percent of workers and 74% of retirees are confident they will have enough money to live comfortably throughout retirement,” EBRI reported. “However, this is not a significant increase from last year. Perhaps contributing to this positive trend upward is workers’ and retirees’ increased confidence in their income.”

U.S. Bureau of Labor Statistics data indicates that wage growth is outpacing inflation.

“Americans are starting to feel this shift as 28% of workers and 32% retirees who are confident feel that way due to their finances,” EBRI reported. “However, inflation remains as a top reason for Americans’ lack of confidence. Among those who do not feel confident, 31% of workers and 40% of retirees cite inflation as the reason why. Additionally, 39% of workers and 27% of retirees who are not confident feel this way due to their lack of savings.”

But quality of life in retirement for the retiree respondents is higher than they anticipated, EBRI found.

“While half of retirees say their overall expenses in retirement are higher than they originally expected, nearly 4 in 5 say they are able to spend money how they want within reason,” the survey found. “Despite higher-than-expected costs, significantly more retirees this year, 3 in 10, believe their overall lifestyle in retirement is better than expected.”