How Do Americans Prepare for Retirement?

While the U.S. has no mandatory retirement age and forcing older workers to retire is, in fact, illegal according to the Age Discrimination in Employment Act, the OECD's Pensions at a Glance report suggests an effective labor market exit age of 65.2 for men and 65.3 for women in the United States in 2022. One possible reason for the U.S. ranking 13th out of 39 OECD countries regarding the highest retirement age is pensions without additional private savings not being sufficient to sustain an adequate standard of living. When choosing how to best save up for old age, there is a clear generational divide in the country.

A Statista Consumer Insight survey from 2022 shows that, on average, a savings book or deposit is still the most suitable method for many respondents, ranking particularly high among Baby Boomers (28 percent) and Gen Z (22 percent). The former group also heavily relies on overnight deposits, with 29 percent of survey participants investing in these specific types of deposits lasting from one day to the next.

Interestingly, real estate ranks highest in the age cluster of survey respondents aged 18 to 29. 24 percent of said respondents see it as best suited for retirement savings, even though median house sale prices increased by almost 30 percent between the first quarters of 2020 and 2024. Another popular retirement scheme in this group is company pension plans. The only cluster of respondents with a popularity share below 20 percent consisted of those born between 1965 and 1979.

Trust in government pensions is low across the board, trailed only by investing in commodities like precious metals. As with savings books and company pensions, the former is seen as especially suitable by both the youngest and the oldest participants in the survey.