The Truth About Retirement: Why the Crisis Narrative Doesn’t Hold Up
The Real Retirement Story: Facts Over Fear
You’ve probably seen the headlines: “Americans are dangerously unprepared for retirement!” But are they true? I’m here to tell you—they’re not. These fear-based narratives are often exaggerated and don’t reflect the full picture of what retirement actually looks like in America today. Andrew Biggs, author of The Real Retirement Crisis, argues that the problem isn’t a lack of savings—it’s the narrative itself. We’re saving more than ever. And when you dive into the numbers, that truth becomes impossible to ignore.
Retirement Savings Are Growing
According to Vanguard’s How America Saves 2024 report, the average 401(k) balance at the end of 2023 was $134,000, up 19% from the previous year. That growth is due to higher contributions and a strong stock market. The median balance was $35,000, which may sound low—but averages naturally rise with age. Workers under 35 have a median balance of $19,000, while those 65 and older have a median of $200,000 and an average of over $600,000. These numbers are trending up, not down, as workers earn more and save longer.
Looking Beyond the Account Balance
Retirement savings don’t live in a vacuum. People often have multiple accounts spread across old employers, which can make balances look smaller than they are. Plus, retirement isn’t just funded by savings. It’s supported by guaranteed income streams like Social Security and pensions, not to mention home equity. In fact, retirees aged 65–74 see their median net worth grow from $364,000 to over $400,000—a 12% increase during retirement. So no, the money doesn’t just run out.
Americans Are Saving at Record Levels
In 2023, the average 401(k) deferral rate reached a record 7.4%. With employer matching, that’s about 12% of income going into retirement accounts. That means Americans are saving roughly 1 out of every 8 dollars they earn through employer-sponsored plans. The personal savings rate—reported at 4.6% in February 2025—doesn’t even count these retirement accounts. So when people say Americans aren’t saving, they’re only telling part of the story.
How Retirement Really Looks for Most
Let’s take a middle-class couple making $60,000 each before retiring. Together, they could receive $48,000 in annual Social Security income. Add just $10,000 a year from investment withdrawals, and they’re living on $58,000—close to their pre-retirement income. But here’s the kicker: expenses drop in retirement. You’re not contributing to a 401(k), paying FICA payroll taxes, or commuting daily. Sixty-three percent of retirees own their homes outright. Many are living more comfortably than they did while working.
The Role of the Media
Why do so many people still believe there’s a crisis? Because fear sells. Headlines like “Americans entering old age least prepared in decades” get more clicks than “Americans are saving more than ever.” But that doesn’t mean they’re accurate. Biggs and other researchers show that retirement satisfaction is high and getting better. Let’s stop being afraid of a future that, for many, looks financially stable and secure.
The Bottom Line
Retirement in America is not a looming disaster—it’s a story of progress. Americans are saving more, spending smarter, and retiring with better financial tools than ever before. The crisis narrative is outdated and misleading. Instead of reacting to fear, look at the data. If you’re saving consistently, investing wisely, and leveraging tools like Social Security, you’re likely on a solid path. The real story of retirement isn’t one of crisis—it’s one of quiet success.
All writings are for educational and entertainment purposes only and does not provide investment or financial advice of any kind.
