Planning & Progress Study 2026

Americans' ‘magic number’ to retire comfortably in 2026 climbed to $1.46 million – $200K more than last year and in line with 2024 estimates. This increase comes as 46% of Americans say they don’t expect to be financially prepared for retirement and nearly half (48%) believe it is somewhat or very likely they will outlive their savings.

All U.S. adults	2026	2025	2024	2023	2022
Expected amount needed to retire comfortably	$1.46M	$1.26M	$1.46M	$1.27M	$1.25M

Perhaps unsurprisingly, American millionaires – people with more than $1 million in investable assets – have higher expectations for retirement income and savings. High-net-worth Americans believe they will need to save at least $2.67 million, on average, to retire comfortably.

While there is no universal retirement number for everyone, Northwestern Mutual generally recommends that people aim to replace around 80% of their pre-retirement income. However, each person's retirement need depends on their individual goals and circumstances, such as when they want to retire, where they’ll live, and what kind of lifestyle they want to maintain throughout their retirement years.

Retirement Preparedness by the Numbers

Even as retirement targets climb, nearly a quarter (23%) of those with retirement savings say they have just one year or less of their current annual income set aside for it.

Gen X'ers, many of whom are nearing retirement, are the least confident in their retirement preparedness – but they have made some progress. Nearly half (49%) of Gen X’ers have at least 4x their current annual income or more saved – an improvement over the 41% who said the same last year. And nearly half (49%) of Gen X’ers say they expect to be financially prepared for retirement when the time comes – up slightly from 46% last year. However, one in five Gen X’ers (20%) say financial challenges or concerns have already caused them to delay retirement, the most of any generation surveyed.

Gen Z continues to be the most confident generation, with 58% expecting to be financially prepared for retirement, though that figure has declined from 63% in 2025.

As a multiple of your current annual income, approximately how much do you have saved for retirement?
Of those with retirement savings	All	Gen Z	Millennials	Gen X	Boomers+
Less than 1x my income	15%	25%	20%	12%	7%
1x	8%	11%	10%	6%	5%
2x	13%	17%	18%	12%	6%
3x	15%	14%	19%	14%	10%
4x	7%	6%	6%	10%	7%
5x	8%	6%	8%	10%	7%
6x	4%	2%	4%	6%	4%
7x	4%	4%	3%	4%	5%
8x	4%	2%	2%	3%	5%
9x	2%	2%	1%	3%	3%
10x	4%	2%	1%	4%	8%
More than 10x my income	10%	4%	3%	9%	21%
Not sure	7%	4%	4%	7%	11%

 

Think they will be financially prepared for retirement when the time comes (among non-retirees)	All	Gen Z	Millennials	Gen X	Boomers+
2026	54%	58%	55%	49%	55%
2025	54%	63%	54%	46%	56%

Longevity and Retirement Timelines Converge

On average, U.S. adults say they started saving for retirement at age 31 and plan to retire at 65. Across generations though, Americans are saving sooner, planning to retire earlier, and expecting to live longer. In fact, more than a quarter (27%) of Americans believe it’s likely they’ll live to 100.

Digging deeper, Gen Z'ers started saving at 22, aim to retire at 61, and a third (32%) think it's likely they'll live to 100. Conversely, Gen X’ers started saving at 32, aim to retire at 67, and less than a quarter (22%) think it's likely they'll live to 100.

Surprisingly, 26% of Gen X’ers say they have not started saving for retirement yet.

	Age started saving	Age to retire	Difference between starting and retirement age
All	31	65	34 years
Gen Z	22	61	39 years
Millennials	28	64	36 years
Gen X	32	67	35 years

The prospect of a longer retirement comes with additional financial pressures. Nearly half (48%) of Americans think it's somewhat or very likely they will outlive their savings. This concern is greatest among Millennials (55%) and Gen X (50%). However, more than a third of Americans (36%) say they have not taken any steps to address this possibility.

In your opinion, what is the likelihood you could outlive your savings?	All	Gen Z	Millennials	Gen X	Boomers+
Net Likely	48%	45%	55%	50%	40%
Very likely	19%	16%	21%	20%	16%
Somewhat likely	29%	29%	34%	30%	24%
Net Unlikely	42%	41%	35%	41%	52%
Very unlikely	25%	26%	19%	22%	32%
Somewhat unlikely	17%	15%	16%	19%	20%
Don’t know	10%	14%	10%	9%	8%

Americans with a financial advisor say they plan to retire at age 63.7, on average, roughly two-and-a-half years sooner than Americans without an advisor (age 66.1). Moreover, nearly three in four Americans with an advisor (74%) believe they will be financially prepared for retirement when the time comes. Just 43% of Americans without an advisor agree.

Northwestern Mutual recommends several “retirement saving rules of thumb” to help people begin to think about how much they may want to save. For example:

The 25x Rule suggests saving roughly 25 times a person’s expected annual spending. Someone with $1.46 million saved would be able to generate about $58,000 in annual retirement income.

The $1,000-a-Month Rule notes that every $1,000 of desired monthly retirement spending translates to $300,000 the individual should have saved. A $1.46 million nest egg would provide approximately $4,800 in retirement income per month.

The 4 Percent Rule suggests that an individual may withdraw 4% of their retirement savings in the first year and withdraw the same amount (adjusted for inflation) for about the next 30 years. Four percent of $1.46 million is approximately $58,000 in annual retirement income.

The Future of Work in Retirement

As retirement horizons extend, many Americans are adjusting not only how they save – but how long they plan to work. Four in 10 (41%) Americans say they are planning to work or are currently working during their retirement years. Among Millennials and Gen X'ers, the number rises to 50%. Across most generations, the percentage planning to work in retirement increased year over year, with Boomers+ being the only exception – declining from 30% in 2025 to 24% in 2026.

Planning to continue working (or currently working) during your retirement years	All	Gen Z	Millennials	Gen X	Boomers+
2026	41%	42%	50%	50%	24%
2025	40%	39%	45%	48%	30%

For many, the motivation to work in their retirement years extends beyond income. The leading reason people say they plan to work in retirement is to continue feeling useful / stimulated (56%). Financial motivations follow closely. Nearly half (48%) say they want additional income to fund their preferred retirement lifestyle, and 47% say they will need the additional income to afford retirement.

What are the reasons you continued / plan to continue working during your retirement years?	All	Gen Z	Millennials	Gen X	Boomers+
Continue to feel useful / stimulated	56%	51%	53%	58%	66%
Want the additional income to fund my preferred retirement lifestyle	48%	43%	46%	50%	53%
Need the additional income to afford retirement	47%	42%	47%	51%	43%
Meet new people / be part of a community	27%	32%	31%	22%	21%
Pursue a new or more fulfilling career	18%	33%	20%	12%	7%

AI’s Impact on Careers

As more Americans envision longer careers – whether by choice or necessity – broader questions about the future of work come into sharper focus. One of the most prominent is the impact of artificial intelligence (AI).

When asked to describe how they felt about the potential impact of AI on their careers, one-third (33%) of Americans say they are somewhat or extremely pessimistic. For Gen Z’ers, many of whom are early on in their careers, the number is significantly higher – 46%. On the other hand, about a quarter (23%) of Americans say they are somewhat or extremely optimistic about AI’s potential impact on their careers.

Which of the following best describes how you feel about the potential impact of artificial intelligence (AI) on your career?	All	Gen Z	Millennials	Gen X	Boomers+
PESSIMISTIC (NET)	33%	46%	32%	33%	26%
Extremely pessimistic	13%	18%	10%	14%	13%
Somewhat pessimistic	20%	28%	22%	19%	13%
OPTIMISTIC (NET)	23%	24%	33%	24%	12%
Somewhat optimistic	15%	14%	21%	17%	10%
Extremely optimistic	8%	10%	12%	6%	2%

Plans for Spending and Social Security

Among pre-retirees (age 45+ and not yet retired), a majority (55%) expect to spend less per month in retirement than they do today. About a third (34%) expect to spend the same, while 11% expect to spend more. High-net-worth individuals are more likely to expect their spending to remain the same in retirement (48%) rather than decline (38%).
 

Do you expect to spend more, less or the same per month in retirement as you are currently spending?	Pre-retirees (age 45+ and not retired)	HNW
More	11%	14%
Less	55%	38%
The same	34%	48%

When asked about plans for claiming Social Security, only three in 10 Gen X’ers (30%) and 21% of Boomers+ say they plan to delay receiving their benefits as long as possible to maximize their monthly benefit. Less than half of Gen X’ers (43%) and Boomers+ (41%) say they will start receiving their benefit when they hit their full retirement age, while more than a quarter of Gen X (27%) and 39% of Boomers+ say they will start to receive payments as soon as they’re eligible, even though their monthly benefit may be reduced.

When do you plan to start receiving your Social Security benefits?	Gen X	Boomers+
As soon as I’m able to, even though my monthly benefit may be reduced	27%	39%
Once I hit my full retirement age, so I qualify for my full benefit	43%	41%
I plan to delay as long as possible so I can maximize my monthly benefit	30%	21%

Social Security remains a top retirement “burning question” for Americans – above other major planning challenges such as outliving life savings, planning for long-term care, managing taxes, and budgeting for healthcare.

Americans’ Top “Burning Questions” About Retirement	2026
How much money will I need to retire comfortably?	40%
Will Social Security be there when I qualify for it?	33%
Is it possible I could outlive my savings?	28%
How can I plan for potential long-term care needs?	27%
What if inflation rises when I'm retired?	24%
How should I budget for healthcare expenses?	24%
How will taxes impact me in retirement?	23%
Will I have enough to leave behind assets for loved ones or charitable causes I care about?	19%
What if the stock market drops when I’m retired?	12%

Advice Drives Confidence in Retirement Planning

Across every measure in the study, individuals who work with a financial advisor report significantly greater feelings of clarity and preparedness in their retirement planning than those who don’t have an advisor.

% Yes	Financial Advisor	No Financial Advisor
I have a good understanding of how inflation could impact retirement and have factored that into my financial plans	73%	50%
I have a good understanding of how taxes could impact my retirement and have factored that into my financial plans	70%	46%
I have a good understanding of how potential drops in the stock market could impact my retirement and have factored that into my financial plans	73%	43%
I have a plan to address healthcare costs in retirement	68%	38%
I have enough life insurance protection in place to take care of my loved ones if something happened to me	64%	38%
I know how much money I will need to retire comfortably	66%	36%
I will have enough to leave behind an inheritance or gift to loved ones and/or charitable causes I care about	65%	34%
I have planned for the potential that Social Security may or may not be in place when I qualify for it	62%	35%
I have planned for the possibility that I could outlive my savings	57%	32%
I have a plan to address long-term care needs in retirement	58%	31%

401K Contribution Limits Increase in 2026

A 401(k) is the primary retirement savings vehicle for a large majority of Americans, thanks to its tax benefits. According to 2025 data from the Investment Company Institute, there were about 70 million active participants in 401(k) plans in 2025. Each year, the IRS limits how much money Americans (and their employers) are able to contribute to a 401(k).

In 2026, individuals can contribute $24,500 to their 401(k), 403(b), governmental 457 plans, and the federal government’s Thrift Savings Plan, up from $23,500 for 2025. Americans aged 50 and older who have maxed out their regular contribution may make an additional $8,000 in catch-up contributions, up from $7,500 in 2025.

Americans contributing to a SIMPLE 401(k) plan (a retirement savings plan offered by companies with 100 or fewer employees), can contribute $17,000 in 2026 – an increase from the $16,500 limit in 2025. Catch-up contributions for most SIMPLE 401(k) plans are $4,000 for Americans aged 50 or older and $5,250 for ages 60–63. Higher SIMPLE contribution limits may apply for plans with 25 or fewer employees or plans that meet certain requirements under the SECURE 2.0 Act.

To learn more about criteria and eligibility requirements, visit the U.S. Internal Revenue Service website.

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Read the News Release

Read the 2026 Planning and Progress Study – Work & Retirement

Read the Local Market Data Report

Northwestern Mutual’s 18^th annual Planning & Progress Study finds half of adults in America now saying they feel financially secure – an increase from 44% last year. Over half also consider themselves to be ‘disciplined’ financial planners. Even optimism around homeownership is on the rise.

But at the same time, a sizeable number of Americans – particularly young adults – are investing in or are considering investing in high-risk/speculative assets such as prediction markets, sports betting, and cryptocurrencies. Among those using or considering these financial instruments, 73% say they’re doing so because they feel financially behind and think those investments offer a faster path to their goals than traditional methods. And among Gen Z, the number is 80%.

Financial Security and Discipline Continue to Improve

The number of Americans who say they’re financially secure went up across every generation, with the largest year-over-year gains coming from Millennials and Gen X.

Feel financially secure	2025	2026
U.S. Adults	44%	50%
Gen Z	36%	39%
Millennials	43%	53%
Gen X	40%	48%
Boomers+	55%	57%

Among Americans with a financial advisor, 71% said they felt financially secure while just 10% did not feel financially secure.

Financial discipline improved too. The number of Americans who consider themselves to be ‘disciplined’ financial planners hit a high of 65% in 2020, during Covid. Four years later it fell to a record low of 45% in 2024. Now it is on a two-year upward trend.

U.S. Adults who consider themselves “disciplined” financial planners
2020	65%
2021	60%
2022	59%
2023	50%
2024	45%
2025	49%
2026	53%

Signs of Financial Nihilism Surface – Led by Gen Z

Gen Z and Millennials make up the largest share of Americans who are investing in – or are considering investing in – high-risk speculative assets this year. These young adults demonstrate the strongest interest in cryptocurrencies, sports betting, and event-based contracts offered through prediction markets.

Currently invested in or considering in 2026	U.S. Adults	Gen Z	Millennials	Gen X	Boomers+
Crypto	24%	32%	35%	20%	8%
Sports betting / prediction markets	17%	32%	24%	10%	3%
Options	13%	17%	18%	14%	4%
Meme stocks	9%	14%	13%	6%	2%

Across generations, a driving factor behind why people are taking greater risks with these investments is because they feel financially behind.

Financial Nihilism	U.S. Adults	Gen Z	Millennials	Gen X	Boomers+
Percentage who feel financially behind and believe high-risk/speculative investments will help reach financial goals more effectively than traditional methods	73%	80%	75%	66%	51%

Another finding from the survey is relevant here – more than half (52%) of Americans say they suffer from a common blind spot: they place too much emphasis on building wealth/growing their assets without dedicating enough to protecting their assets and managing against risks. And younger adults are reporting this planning gap more often: for Gen Z the number is 57% and for Millennials it’s 62%.

Homeownership Feels More Attainable – And Parents are Playing a Bigger Role

Homeownership remains central to Americans’ financial aspirations. Three-quarters (75%) of U.S. adults agree homeownership is essential to building wealth. Notably, agreement is highest among high-net-worth Americans ($1 million+ in investable assets) and those working with a financial advisor.

And among non-homeowners, the prospects of owning a home at some point are looking better. Notably, Gen Z and Millennials both saw upticks in optimism.

Among non-homeowners, percentage who believe owning a home is financially affordable now or will be in the future	2025	2026
U.S. Adults	33%	42%
Gen Z	42%	54%
Millennials	34%	47%
Gen X	33%	31%
Boomers+	16%	15%

Additionally, headwinds are easing, with fewer Gen Z and Millennial non-homeowners citing down payments, mortgage rates, or market competition as barriers compared to last year.

I don't have enough saved for a down payment	2025	2026
Total	64%	53%
Gen Z	70%	52%
Millennials	58%	52%

 

I'm not confident I can afford all the associated costs of home ownership (insurance, repairs, etc.)	2025	2026
Total	55%	51%
Gen Z	54%	47%
Millennials	52%	52%

 

Mortgage rates are too high	2025	2026
Total	48%	40%
Gen Z	57%	43%
Millennials	48%	47%

 

The housing market is too competitive and I am therefore priced out	2025	2026
Total	43%	38%
Gen Z	54%	42%
Millennials	37%	41%

Perhaps the most striking finding: 74% of parents with children at home would consider or have already started financially planning to help their kids buy a home. Among those parents, 29% say helping them buy a home someday is more important than helping them pay for college, and 55% say it’s equally important.

Inflation is Americans’ Top Concern Even as Its Real-World Impact Eases

The study finds that more people expect the U.S. economy to weaken in 2026 (45%) compared to those who expect it to improve (36%). Additionally, more than half (56%) of adults believe inflation will increase this year – up from 51% who said the same in 2025. Older adults are notably the most pessimistic when compared to last year – the number of Gen Xers who expect inflation to rise went from 46% in 2025 to 57% this year, and Boomers+ jumped from 46% to 56%.

Americans overwhelmingly cite inflation as the #1 obstacle to achieving financial security (42%), well ahead of things like lack of savings (25%), personal debt (22%), and healthcare costs (22%).

That said, while people’s real-world experience with inflation continues to be significant, it’s slightly improved from last year. Nearly eight in ten (79%) Americans say they’ve experienced higher prices in the grocery aisle in the last three months, down from 84% in 2025. But the biggest change is a 16-percentage point decline among those who have experienced higher expenses at the gas pump. This year, only 44% say they are seeing steeper gas prices, down from 60% last year.

Additionally, among those who have experienced elevated costs in each area, there have been general declines among those who indicate those costs are having a moderate-to-large impact on their finances.

Moderate-to-Large Impact of Inflation on Finances
	2025	2026	Change from 2025
Groceries	80%	72%	-8%
Gas	75%	71%	-4%
Utilities	77%	69%	-8%
Housing expenses	81%	79%	-2%
Childcare expenses	80%	77%	-3%

In another positive sign, household income is keeping pace with inflation slightly better this year, according to the research. The number of Americans who say their household incomes are growing slower than inflation dropped from 52% to 48%.

Household income vs. Inflation	2025	2026
Growing slower than inflation	52%	48%
On pace with inflation	28%	31%
Growing faster than inflation	11%	12%
Not sure	9%	9%

Wallets Tighten but Many Continue to Utilize ‘Buy Now, Pay Later’ Options

Fewer Americans expect to increase their spending on discretionary purchases in 2026. Gen Z remains the most likely to spend more (32%), though that’s down from 39% in 2025.

Non-essential purchases	2025	2026
Expect to spend more	29%	24%
Expect to spend the same	34%	40%
Expect to spend less	34%	33%
Unsure	3%	3%

When it comes to spending, Americans are divided on whether small daily sacrifices like giving up a daily cup of coffee can make a difference. According to the research:

• 47% believe cutting small purchases like a daily cup of coffee can improve long-term financial security
• 53% believe micro-steps like skipping coffee won’t materially impact long-term outcomes

However, relatively large numbers of Americans are opting for installment-style payments, even for small purchases.

• A third (33%) of U.S. adults used “Buy Now, Pay Later” options when making large purchases like vacations, event tickets, appliances and smartphones in 2025, and nearly a quarter (23%) used them for daily purchases like groceries and gas.
• This year, the share who plan to use “Buy Now, Pay Later” options is similar – 35% for large purchases and 23% for daily purchases.
• Use of “Buy Now, Pay Later” is most prominent among Gen Z and Millennials. Half of Gen Z (49%) and Millennials (49%) plan to use ‘Buy Now, Pay Later’ for large purchases in 2026; and a third or more plan to use it for small purchases – 36% of Gen Z and 32% of Millennials.

Americans’ Personal Debt Holds Steady, but Priorities may be Shifting

Among Americans who carry personal debt, the average amount people owe is $21,700 – nearly identical to the $21,500 reported in 2025.

Americans' Personal Debt, Exclusive of Mortgages
2026	$21,700
2025	$21,500
2024	$22,700
2023	$21,800
2022	$22,400

Credit cards remain the top source of debt by a wide margin, accounting for more than double the #2 source (car loans) and quadruple the #3 source (medical debt). Among Millennials, educational expenses for children and family members made the top three this year, replacing medical debt and ranking even higher than their own personal education loans.

Main Sources of Debt	U.S. Adults	Gen Z	Millennials	Gen X	Boomers+
Credit card bills	29%	21%	32%	30%	29%
Car loan	12%	12%	12%	15%	11%
Medical debt	7%	8%	7%	8%	5%
Personal education loans	6%	12%	7%	4%	1%
Educational expenses for children/family members	5%	9%	8%	5%	1%
Caring for loved ones	4%	6%	5%	4%	1%

According to the study, six in 10 (62%) U.S. adults with debt prioritize paying down debt, compared to 38% who prioritize saving. This continues a long-term trend of U.S adults focusing more on debt repayment than savings, though it’s the first time since this question was introduced in 2022 where the share of people prioritizing paying down debt has declined.

U.S. Adults	2022	2023	2024	2025	2026
Prioritize saving money	43%	39%	36%	36%	38%
Prioritize paying down debt	57%	61%	64%	64%	62%

Read the News Release

Read the 2026 Planning and Progress Study – The Financial States of America

Read the Local Market Data Report