With more Americans living paycheck to paycheck, a new report suggests retirement security may be slipping further out of reach.
With more Americans living paycheck to paycheck, retirement security may be slipping further out of reach.
According to the 2025 Goldman Sachs “New Economics of Retirement” report, 42% of Gen Z, millennials, and Gen X said they’re already living paycheck to paycheck.
The trend is expected to get worse. By 2033, Goldman said 55% of workers will be living paycheck to paycheck, with the number going up to 65% by 2043.
“You can see how costs like child care, costs like going to college, costs, you know, of housing and renting — all of those costs are taking a much larger percent of share of someone’s income,” said report author Chris Ceder in an interview with CBS MoneyWatch.
Housing now eats up 51% of median household income, compared to 33% in 2000. Private college tuition has risen from 65% to 85% of income, while public college costs climbed to 36%.
Those rising costs, combined with major life disruptions, are hitting younger workers hardest. Some 66% of Gen Z and 59% of millennials reported experiencing at least one major life event — marriage, divorce or buying a home — in the past two years. Of those, about 70% stopped their retirement contributions, borrowed from their plans or delayed retirement.
Even for those who are saving, they may not be saving enough.
“You’re still looking at (needing) anywhere between 8% to 10% (of income) — assuming your employers are also saving,” Ceder said. “So the numbers are still meaningful that you need to save. And, generally, you need to save over the long term of your career as well.”
Nearly 70% of savers think they’re on track or ahead, yet about 60% expect to outlive their savings — a gap Goldman Sachs calls “the optimism gap.”
Ceder’s advice? Get involved in a personalized retirement plan now.
“The data does show that people who are engaged and are focused and are actionable, they’re actually making significant progress,” Ceder told CBS MoneyWatch.
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