America Gets a Failing Grade on Retirement Readiness
If retirement readiness were a school exam, America would be failing. The National Retirement Readiness Index scored America’s retirement preparedness at just 45.8 out of 100, placing the nation in the “moderate risk” category. But let’s be honest—”moderate risk” is a polite way of saying “most Americans are in trouble.”
AMERICA’S RETIREMENT READINESS SCORE
45.8/100
Moderate Risk Category
This comprehensive assessment looked at five critical dimensions of retirement preparedness. The results should serve as a wake-up call for every American.
Breaking Down America’s Report Card
| Readiness Category | Score (% of Potential) | Grade |
|---|---|---|
| Healthcare Readiness | 42.1% | ❌ F |
| Savings & Investments | 43.2% | ❌ F |
| Lifestyle & Spending | 46.5% | ⚠️ D |
| Emotional Well-being | 48.3% | ⚠️ D |
| Economic & Policy Confidence | 50.8% | ✓ D+ |
| OVERALL SCORE | 45.8% | F |
Source: IRALOGIX National Retirement Readiness Index 2025
Notice anything? Not a single category scored above 51%. America is failing in every dimension of retirement readiness.
The #1 Problem: Healthcare Unpreparedness
Healthcare readiness scored the lowest at just 42.1%. This is particularly alarming because healthcare costs are one of the most predictable expenses in retirement—and one of the largest.
💡 DID YOU KNOW: Fidelity estimates that a 65-year-old retiring in 2025 will need approximately $172,500 just for healthcare expenses throughout retirement. That doesn’t include long-term care, which could easily add another $100,000 or more.
Most Americans have no plan for these costs. They haven’t:
- Researched Medicare options and supplement plans
- Calculated potential out-of-pocket expenses
- Considered long-term care insurance
- Maximized Health Savings Accounts (HSAs)
- Budgeted for prescription drugs and medical equipment
Savings and Investment Gaps: Only 43.2% Ready
The second-lowest score was in savings and investments. This reflects widespread uncertainty about:
- How much is enough? Most people have no idea what their actual retirement number should be.
- How long will it last? With increased life expectancy, retirement could last 25-30 years or more.
- What about market downturns? Few have stress-tested their plans against potential bear markets.
- Inflation concerns: With inflation eroding purchasing power, many worry their savings won’t keep pace.
MEDIAN RETIREMENT SAVINGS (Ages 55-64)
$185,000
Only $7,400 per year at 4% withdrawal
Lifestyle and Spending: Americans in Denial
The lifestyle and spending readiness score of 46.5% reveals something troubling: most Americans haven’t adjusted their expectations for retirement reality.
Many believe they can maintain their current lifestyle in retirement despite:
- Having saved far less than needed
- Planning to rely heavily on Social Security
- Not accounting for inflation
- Underestimating healthcare costs
⚠️ The Reality Gap
Studies show that retirees typically need 70-80% of their pre-retirement income to maintain their lifestyle. But many Americans are on track to replace only 40-50% of their income.
How Different States Score on Retirement Readiness
While the national average is 45.8, there’s significant variation across states:
Best Prepared States (55+ score):
- Utah: 58.3 (Strong 401k participation, lower cost of living)
- Colorado: 56.7 (High employment, active aging population)
- Massachusetts: 55.2 (High income, strong pension systems)
Least Prepared States (Under 40 score):
- Mississippi: 36.4 (Low income, high healthcare costs)
- West Virginia: 37.8 (Economic challenges, high dependency)
- Louisiana: 38.9 (Low savings rates, hurricane risk)
Your Personal Retirement Readiness Action Plan
Don’t let these statistics depress you—let them motivate you. Here’s how to improve YOUR retirement readiness score:
10-Point Retirement Readiness Checklist
- Healthcare Planning (42.1% → Your Goal: 80%+)
- Research Medicare options 3-5 years before retirement
- Consider long-term care insurance while still healthy
- Maximize HSA contributions if eligible ($4,150 individual, $8,300 family in 2024)
- Budget $7,000-10,000 annually for healthcare in retirement
- Savings & Investments (43.2% → Your Goal: 75%+)
- Calculate your retirement number (25x annual expenses is a good rule of thumb)
- Maximize 401k contributions ($23,000 + $7,500 catch-up if 50+)
- Diversify across accounts (401k, IRA, taxable accounts)
- Consider working 2-3 extra years to dramatically improve your situation
- Lifestyle & Spending (46.5% → Your Goal: 70%+)
- Track current spending to understand actual needs
- Identify areas to cut in retirement (commuting, work clothes, etc.)
- Plan for new expenses (travel, hobbies, healthcare)
- Consider downsizing or relocating to lower cost areas
- Emotional Well-being (48.3% → Your Goal: 75%+)
- Develop non-work identity and purpose
- Build strong social connections outside of work
- Plan activities and hobbies for retirement
- Discuss retirement vision with spouse/partner
- Policy & Economic Confidence (50.8% → Your Goal: 65%+)
- Stay informed about Social Security and Medicare changes
- Diversify income sources (don’t rely on one stream)
- Plan for inflation (3% annually is reasonable)
- Build emergency fund (6-12 months expenses)
The Bottom Line
America’s retirement readiness score of 45.8 is a national emergency. But YOUR score doesn’t have to match the national average. With focused effort in each of these five areas, you can dramatically improve your retirement security.
Remember: Retirement readiness isn’t just about money—it’s about having a comprehensive plan that addresses healthcare, lifestyle, emotional well-being, and economic resilience.
What’s your retirement readiness score? Take our free assessment and share your results in the comments below.
About the Author: Robert Chen is a Retirement Finance Analyst at RetireMetric.com, specializing in retirement readiness assessment and comprehensive planning strategies.
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