Report: How Prepared Are Americans for Retirement?

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If you’re like millions of Americans, retirement is one of the most anticipated events in your life — but are you ready for it?

A recent report from Fidelity breaks down whether savers are on track to meet estimated retirement income needs. The Retirement Preparedness During Uncertain Times culls data from more than 3,500 survey respondents.  

What Is Americans’ Retirement Score?

U.S. retirement score
Screenshot via Fidelity

From the survey results, Fidelity assigned Americans a retirement score, comprised of color-coded indicators of preparedness. For 2023, Americans’ preparedness has declined to yellow, “with Millennials seeing the greatest decline,” says the report.

Here are what the colors indicate and what percentage of U.S. households are in the respective category:

Zone / Status% of U.S. Households in 2023% of U.S. Households in 2020
Red — Needs Attention34%28%
Yellow — Fair18%18%
Light Green — Good16%17%
Dark Green — On Target32%37%

Alarmingly, when you consider the red “needs attention” and yellow “fair” categories together, the study reveals that 52% of American households are “at risk of not being able to cover retirement expenses.”

How To Improve Your Retirement Preparedness

The survey lists three ways Americans can improve their retirement readiness.

“Taking these three actions in tandem can bring America’s retirement score all the way from yellow to dark green,” Rita Assaf, vice president of retirement at Fidelity, says in the report. “However, even taking just one of these actions can significantly improve preparedness. With everyone having unique circumstances though, it’s important to customize what works best for your household.”

1. Save As Much as You Can

Fidelity advises saving as much money as you can during your working years, which is also a major recommendation from money expert Clark Howard.

“Aim to save at least 15% of your pre-tax income each year, which includes any employer match,” it says in the Fidelity survey. “If 15% isn’t possible, get in the habit of increasing your contribution rate by 1% each year until you get to the 15%.”

At Team Clark, we recognize that a key aspect of saving is reducing expenses. To cut down on what you pay out each month, see if you can:


Clark says the key to starting saving is to make it a habit.

“It’s all about building habits, whether it’s with your health or your wallet, that you do it one step at a time,” Clark says. “And then, when you’re in that habit, you really can move toward the goals that are really going to change your financial future.”

Once you have a financial goal in mind — a specific amount you want to save each month or year — you can work to reach it each month.

Don’t know where to begin? Start by creating a budget.

Read our guide on how to save money, reduce expenses and build savings.

2. Examine Your Asset Mix

“Make sure you have the right mix of stocks, bonds and cash based on how far you are from retirement, and how comfortable you are taking potential risk in your portfolio,” it says in the Fidelity survey.

Because of their simplicity, Clark recommends target date funds as a strong investment choice for most people. Target date funds automatically diversify your investment portfolio and periodically rebalance over time. 

“With target date funds, you don’t have to do a thing other than invest your money. It could be the best and easiest investment choice you ever make,” Clark says.

“You just pick the year closest to when you think you’re going to retire and you just slap all the money you’re saving into that choice.”

Read Clark’s guide on how to invest in target date funds.


3. Re-Evaluate Your Retirement Plan

In addition to building up your savings, “claiming Social Security at age 70 instead of age 65 could increase your payments by 43%,” it says in the Fidelity survey.

“I’m still working in my 60s,” Clark says. “There’s a disadvantage to me taking Social Security now … because of the way Social Security punishes you to a certain point if you are still working. So especially for me, it’s smart to wait the full run until I turn 70 to start receiving Social Security.”

He recommends that you continue working past retirement age if your personal circumstances allow you to postpone Social Security. As you age, the money you earn in the meantime will come in handy as you deal with expenses related to inflation and rising health care.

Read our guide on how to save and invest the Clark Howard way.

Final Thoughts

Depending on the money moves you take now, retirement can either be a comfortable time to look forward to or one filled with financial anxiety.

If you’re not doing so already, Clark wants you to start saving now. He recommends that you set up automated savings so you can put away something, even as little as $10 a paycheck, to build an emergency fund and then start saving for retirement.

Once you’ve started saving, you can begin to invest that money so that it grows.

It is these simple — but critical — financial moves that can help move Americans out of the not prepared for retirement danger zone into the “on target” category.

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