Many Americans find themselves leaving the workforce earlier than they originally expected, according to a report titled Bridging the Gaps in Retirement Expectations
released by the TIAA Institute. In a survey of 1,591 U.S. adults ages 22 through 75 conducted in July 2025 in partnership with Ipsos, the average retiree stated they retired at age 57, as reported by USA Today. Among those surveyed retirees, 52% reported retiring earlier than expected, while only 6% said they retired later than planned.
Retiring Earlier Than Planned and Facing Regrets
By contrast, the average working American surveyed expects to retire five years later at age 62. Earlier studies cited in the report, including annual surveys from the Employee Benefit Research Institute and the Transamerica Center for Retirement Studies, show that workers tend to retire around age 62, though the latest EBRI survey found workers expect to retire at age 65.
The TIAA Institute report revealed that current retirees harbor significant regrets regarding their financial preparation. Among retirees’ top concerns, 76% stated they should have started saving earlier in life, and 71% said they should have saved more. Furthermore, retirees ranked underestimating healthcare costs at 49%, underestimating the impact of life events like job loss and caregiving at 49%, and failing to establish clear retirement goals at 47% among their five biggest retirement-planning regrets.
The Impact of Career Interruptions and Life Events
Work disruptions frequently derail long-term savings plans. According to planadviser, 51% of all respondents reported stepping away from the labor market for more than a year during their working lives. The rate was even higher for parents at 56% and caregivers at 65%. Tim Pitney, TIAA’s head of lifetime income distribution, described combining career gaps with retirement savings shortfalls as a “double whammy.”
The primary reasons cited for leaving the job market for more than a year include:
- Caring for children (17%)
- Changing careers (16%)
- Experiencing burnout (16%)
- Getting laid off (16%)
- Moving (16%)
Millennials face unique hurdles, with half reporting they have stepped away from the labor force for more than a year, driven by career changes (20%), child care (18%), and burnout (17%). Additionally, 20% of Millennials have cashed out their retirement savings entirely when changing jobs, an issue known as leakage, according to plansponsor.
Shifting Funding Sources and Confidence Gaps
The financial foundation of retirement is undergoing a generational shift. Additionally, confidence in Social Security is declining across younger generations:
- Baby Boomers: 94% expect to use Social Security.
- Gen X: 75% expect to use Social Security.
- Millennials: 64% expect to use Social Security.
- Gen Z: 51% expect to use Social Security.
While current retirees leaned most heavily on Social Security followed by employer pensions, pre-retirees expect their largest income source to be money already saved inside retirement accounts, dropping Social Security to second place, according to Wealth Professional.
Planning Recommendations and Policy Context
Surya Kolluri, head of TIAA Institute, noted that workers need to plan for a retirement that may arrive sooner than anticipated. Kolluri recommended running multiple scenarios, suggesting workers plan for ages 57, 62, and 65. Workplace retirement plans remain critical, with 70% of surveyed workers reporting access to a 401(k)-type plan and 89% of those workers enrolled.
Against this backdrop of savings challenges, President Donald Trump signed an executive order creating TrumpIRA.gov to provide a retirement plan enrollment option for workers whose employers do not offer 401(k) plans, and indicated he is looking strongly at adopting elements of Australia’s retirement savings system, as reported by AOL.
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