The majority of Americans don’t think they can depend on Social Security for retirement income and worry about their long-term financial stability, according to the 2023 1Q Quarterly Market Perceptions Study from Allianz Life Insurance Company of North America (Allianz Life).

Nearly three in four (74%) say they can’t count on Social Security benefits when planning retirement income. At the same time, 88% say it is critical to have another source of guaranteed income beyond Social Security benefits in order to have a comfortable retirement.

“Social Security benefits are often the backbone of a retirement strategy but it cannot be your entire strategy,” said Kelly LaVigne, vice president of consumer insights at Allianz Life. “A strong retirement strategy will ensure you have enough guaranteed income to cover your essential expenses. That guaranteed income can come from Social Security benefits, along with other investments and protection products such as annuities.”

Cautious about Investing

Fewer Americans worry about a major recession right around the corner (57%) than last year. Still, 41% say they are concerned they will be laid off because of an economic downturn in 2023.

In addition, most Americans are still very cautious about investing. More than half (63%) are keeping more money out of the market than they think they should and 62% would rather have their money sit in cash than endure market swings.

More Americans are also expressing concern about their long-term financial health. For example, 78% worry that they might not be able to afford the lifestyle they want in retirement due to the increased cost of living.

This is up from 73% last quarter and 68% from first quarter 2022. Meanwhile, 66% worry that if they don’t increase their retirement savings soon, it will be too late to have a comfortable retirement.

“A strong retirement strategy will address potential risks like inflation and taxes,” LaVigne said. “You can’t prepare for everything, but you can prepare for anything – if you start preparing for retirement early.”

Gen X Also Worried

Gen Xers, people born between 1964 and 1978, are worried about their retirement and long-term financial stability.

• 43% of Gen Xers worry their employer will suspend their 401(k) match, compared to 38% of millennials (born between 1979 and 1996) and 24% of boomers (born between 1945 and 1963)

• 67% of Gen Xers say they are keeping more money out of the market than they should, compared to 66% of millennials and 54% of boomers

• 85% of Gen Xers worry that they might not be able to afford the lifestyle they want in retirement because of the increased cost of living, compared to 80% of millennials and 72% of boomers.