President Trump signs TrumpIRA order expanding access to retirement savings
President Trump signed an executive order creating TrumpIRA.gov, which can be used by workers whose employers do not offer a 401(k) plan to enroll in a retirement plan.
Americans are retiring earlier than expected, and most retirees wish they had saved better.
Those are the conclusions of a new report from the TIAA Institute, the research arm of retirement service providers.
TIAA leaders say the findings are likely related. Workers who retire early have less time to save and must save for long-term retirement.
Roughly three-quarters of retirees surveyed said they regret not saving earlier in life. Almost three-quarters said they wish they had saved more.
“People are expressing regret,” said Surya Kolli, director of the TIAA Institute. “That’s a powerful emotion. We can apply that emotion to people who haven’t left the workplace.”
Many Americans retire earlier than planned
The new report, “Closing the Retirement Expectation Gap,” joins a larger body of research showing that American workers are more likely to retire earlier than planned and before they’re ready.
In a TIAA Institute survey released July 22, the average retiree said they retired at age 57. 52% of retirees said they left their jobs earlier than planned, while only 6% said they left their jobs later than planned.
In contrast, the average working American surveyed expects to retire at age 62 in five years. The survey surveyed 1,591 adults between the ages of 22 and 75.
Previous research has consistently found that American workers retire earlier than planned.
Two annual surveys conducted by the Employee Benefit Research Institute and the Transamerica Retirement Research Center both show that American workers tend to retire around age 62.
Most workers don’t intend to retire that early. According to EBRI’s latest research, the average worker expects to retire at age 65. According to Transamerica, 39% of workers plan to retire after age 70, if at all.
Workers often plan for retirement around the age of two or three. One is age 65, which is when Medicare becomes available. The other is age 62, when most retirees become eligible for Social Security. The third is age 67, which Social Security considers the full retirement age for most workers.
But ultimately, most workers don’t get to choose when they retire. Retirement often comes suddenly and unexpectedly, such as due to corporate layoffs or poor health at home.
“It could be a health incident. It could be nursing care. It could be evacuation. It could be AI,” Corli said.
Retiring early can disrupt your retirement plans.
An unexpected early retirement can have a big impact on your retirement plans.
Suppose a worker saves $500,000 and plans to retire at age 65, using those savings and Social Security to fund his retirement for 20 years.
Now, let’s say the worker is laid off at age 60 and can’t find another job. That means you have five years less to save for retirement, and those savings must be used to fund another five years of retirement.
In addition to these setbacks, early retirees are still not eligible for Social Security or Medicare.
Workers need to plan for early retirement
Corli said one takeaway from the study is that workers need to plan for retirement, which may come sooner than expected. He said workers can plan to retire at age 65, but they need to save enough for a retirement that starts earlier and lasts longer.
“Given this data, let’s play out three scenarios,” he said. “Let’s make it 57, 62, 65.”
The TIAA Institute report states that workplace retirement savings plans are “more important than ever” in achieving these goals.
The survey found that 70% of workers said they had access to a 401(k)-type plan, and 89% of them said they participated in one.
Three-fifths of people who saved for retirement at work said they were automatically enrolled. Auto-enrolment features tend to increase savings rates and are considered key to future retirement savings success.
Starting in 2025, most new 401(k) plans were required to automatically enroll employees, rather than leaving the decision up to employees.
Here are some tips to help workers increase their retirement savings.
Make the most of your tax-advantaged retirement savings
Consider setting aside as much as possible in a tax-advantaged retirement account.
401(k)s already have high contribution limits, $24,500 in 2026. If you’re nearing retirement, consider getting your savings as close to the limit as possible.
Americans age 50 and older can save even more with “catch-up” contributions, increasing the annual 401(k) limit to $32,500. Some savers between the ages of 60 and 63 face an even higher catch-up limit of $35,750.
Contribution limits for individual retirement accounts are even lower: $7,500, or $8,600 if you’re 50 or older.
Please continue working if possible
Delaying retirement, even by a year or two, can be a powerful tool for building retirement savings.
A Stanford University study found that delaying retirement by just three to six months has the same impact on retirement savings as increasing your 401(k) contribution rate by one percentage point over 30 years.
Let’s say you postpone your retirement for a year. You can max out your retirement savings that year, potentially adding tens of thousands of dollars to your account. Also, since you don’t have to withdraw your savings, your savings will last long after you retire.
increase cash savings
The closer you get to retirement, the more likely you are to tap into your savings for living expenses. Ideally, you should keep some of these savings in cash.
Retirement experts say a wise goal is to have at least one year’s worth of living expenses saved in cash or a cash-equivalent account such as a high-yield savings or money market fund.
