LIMRA: The Retirement Planning Gap Is Real -- 88% of Pre-Retirees Think About Retirement Income, but 50% Lack an Updated Plan

LIMRA's Retirement Income Readiness Report finds only 1 in 4 American pre-retirees believe protected lifetime income such as Social Security, pensions and annuities will cover their basic expenses in retirement

WINDSOR, Conn., Aug. 5, 2026 /PRNewswire/ -- How prepared do Americans feel for retirement? New research from LIMRA finds that Americans nearing retirement know what's coming — they just aren't acting on it. While 88% of pre-retirees have thought about how they will generate income in retirement, 50% lack a recently updated written retirement plan and only 40% work with a financial advisor. The result is a retirement confidence gap that savings alone won't close.

The findings come from LIMRA's Retirement Income Readiness Report which examined how pre-retirees and retirees aged 45 and older perceive their financial preparedness for retirement — and what drives that perception. The research suggests retirement confidence today is about more than just financial resources; planning, engagement, and a sense of security about future income also play important roles.

While nearly 6 in 10 pre-retirees rate themselves highly prepared for retirement, roughly 4 in 10 do not — and retirees, reflecting back, report nearly the same split. Cost-of-living volatility (43%) is the most frequently mentioned retirement concern among American pre-retirees, followed by the risk of outliving savings (30%). Even financially prepared consumers remain worried about running out of money in retirement.

Key findings for the life insurance and retirement industry:

• Awareness without action. 88% of pre-retirees have thought about retirement income — yet 50% lack a meaningful or recently updated plan, and 76% have no plan or have spent less than 5 hours in the last year planning. The intention-to-action gap represents the industry's clearest engagement opportunity.
  
  
• Advice is a confidence differentiator. Consumers who work with a financial advisor or planner are far more likely to feel prepared for retirement — 77% versus 47% of those without one. Yet only 40% of pre-retirees currently work with a financial advisor, and just 8% of the least-prepared group does.
  
  
• Demand for protected income is broad, not niche. 74% of pre-retirees want to learn more about protected lifetime income options, and 78% with a pension and/or annuity report high preparedness, compared with 50% of those without either. Among pre-retiree survey respondents, 93% of those reporting high retirement preparedness had taken action to learn about protected income, compared with 67% of those reporting low preparedness.
  
  
• The expectations gap is stark. Despite that demand, only 25% of pre-retirees believe their protected income sources will cover essential living expenses in retirement — signaling substantial unmet need for guaranteed income products, education and guidance as the pension era recedes. Contrast that with current retirees; 52% of whom say their basic living expenses are fully covered by protected lifetime income today.
  
  
• Cost and control are the barriers to beat. The biggest psychological obstacles to annuity consideration are perceived cost and reluctance to give up control of assets— product design and messaging challenges the industry can directly address.

"Consumers are telling us exactly where the industry can help," said Bryan Hodgens, senior vice president and head of LIMRA research. "They value guaranteed lifetime income, they're worried about outliving their money, and three-quarters of them are raising their hands to learn more. The companies that meet that demand with clear education, accessible advice and products that address cost and control concerns will define the next decade of retirement security."

What drives retirement preparedness? The research found that the drivers of preparedness shift across the retirement transition. For pre-retirees, wealth, planning and protected lifetime income work together in an interconnected way; for retirees, preparedness becomes more hierarchical and anchored in wealth, with planning and protected income playing stabilizing, confidence-reinforcing roles.

For LIMRA member companies — insurers, retirement plan providers and distributors — the implication is clear: retirement preparedness is increasingly shaped not just by savings accumulation, but by planning engagement, trusted guidance and confidence in predictable income.

Methodology note: Findings are based on LIMRA's Retirement Income Readiness Report, fielded in April 2026, surveying 486 pre-retirees (workers aged 45+ who plan to retire within 10 years) and 804 retirees aged 45+ in the United States. Preparedness reflects respondents' self-reported score on a 0–10 scale; retirees were asked to reflect back on their preparedness at retirement.

About LIMRA

Serving the industry since 1916, LIMRA offers industry knowledge, insights, connections, and solutions to help nearly 700 member organizations navigate change with confidence.

SOURCE LIMRA