While media pundits and everyday Americans talk about a "retirement crisis" set to unfold, the actual U.S. retirement readiness picture is far more nuanced.
In fact, as demonstrated by a recently published PGIM survey, a majority of American workers feel that their own retirement preparedness is on track but also widely believe that the nation's retirement system is falling short for their peers.
Specifically, the survey confirms a widely held perception that "a national retirement crisis exists," with 58% of respondents somewhat or strongly agreeing with this statement. However, when asked the top reason they believe this, 52% of respondents cited "the situations of people they know" — more than the 43% who cited their personal situation.
Another driver of the crisis belief, according to the survey, is retirement media coverage, cited by some 42% of respondents.
"While I understand the perspectives and obstacles Americans face when it comes to saving for retirement, I prefer to think of the current state as a challenge, not a crisis," said David Blanchett, a portfolio manager and head of retirement research at PGIM DC Solutions.
While some groups continue to lack access to the retirement savings system, Blanchett pointed out, those who do have access are participating in "one of the best in the world."
In addition, policymakers and other key stakeholders such as employers and state governments are making changes to increase the availability of workplace retirement plans and improve the behaviors among employees participating in them. Such priorities are to ensure Americans that they can live a better life in retirement.
Perception vs. Reality
Blanchett was intrigued by how an individual's situation related to general perceptions.
"Those who describe their own situation as a crisis are nearly twice as likely to agree there is a national crisis," he said, "but many more are basing their perception on media coverage or the situations of others."