Oct 18, 2025
According to a recent report from PNC Bank, there’s a striking mismatch in beliefs about retirement readiness between American employers and employees. The study highlights that 78% of U.S. employers believe their staff are at least somewhat prepared for retirement, whereas only 45% of employees agree (1).
This gap could reflect a deeper set of issues. It suggests a breakdown of communication issues between employers and employees, problems with benefit literacy, and financial pressures that make it difficult for many to prioritize saving for retirement.
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So, what can employees do to confidently plan for retirement? It’s likely they’ll need to approach the issue from multiple angles.
Employees face countless obstacles to saving for retirement
Unlike with previous generations, it’s relatively uncommon today for private-sector employers to provide their workers with a pension or defined-benefit retirement plan. Instead, employers are much more likely to offer a defined-contribution plan, like a 401(k) or 403(b), to their employees. These put the onus of building a sufficient retirement nest egg on the employee.
According to the U.S. Bureau of Labor Statistics, only 15% of workers in the private sector had access to a defined benefit plan in 2023, while 67% had access to a defined-contribution plan (2).
As the burden of saving for retirement has shifted squarely onto the shoulders of workers, many don’t feel prepared to tackle the significant task of building a nest egg for their golden years. After all, many are feeling the pinch of inflation on their wages, which likely puts downward pressure on the amount they can contribute to retirement.
For many, finding room in their budget to save for retirement seems completely out of reach — so they simply don’t save enough. A recent Vanguard report found that Americans at lower income levels are on track to retire with less than they need to maintain their current standard of living (3). While some may be able to realistically find some room in their budget for retirement savings by cutting back on discretionary spending, that’s not an option for all households.
Beyond saving enough, employees don’t always understand the full extent of the benefits offered by their employer. In fact, 25% of employees reported they feel “a little” or “not at all” informed about their benefits, according to a survey of 153 employees from Payroll Integrations (4).
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Retirement readiness: How to take charge
If you don’t feel prepared for retirement, you aren’t alone. The good news is that you can take charge to get yourself ready for retirement, whether you have a few years or decades of working years ahead of you.
Getting familiar with your workplace retirement benefits is a good place to start. Generally, your Human Resources department can provide some information about your benefits.
If you still have questions or want more help navigating the tools, you could consider requesting a lunch-and-learn session from your employer. It might help you and your coworkers get up to speed on what retirement benefits your employer offers.
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If you aren’t getting too much help from your employer on understanding your benefits, consider reaching out to the federal Employee Benefits Security Administration (5). You may find some helpful resources there about how retirement accounts generally work.
Beyond finding out more about your employer’s retirement benefits, you’ll need to figure out your savings target for your retirement nest egg. One popular formula is to aim to save an amount equal to 25 times your annual expenses. For example, if you spend $50,000 per year, then your target retirement amount would be $1.25 million, according to this baseline rule. Of course, you will likely need to adjust that higher or lower, based on your spending expectations in retirement. But it’s a good starting point (6).
With that general goal in mind, you can work backward to understand how much you’ll need to save each month or year in order to hit your retirement goals. For example, a 30-year-old planning to retire at 65 would need to invest $600 per month with an annual return of 7% in order to have $1 million at retirement. But a 50-year-old would need to contribute $3,300 per month to hit the same goal at 65.
Make sure to factor any employer contributions into your plan. Many employers offer to match your contributions up to a certain amount, which can add up over time.
As you beef up your knowledge about retirement, you can take action to align your personal finances to meet your savings goals. This might look like cutting back on some costs, increasing your income, or investing to grow your funds. Over time, you can begin to feel more confident about your retirement plans.
Article Sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
PNC (1); U.S. Bureau of Labor Statistics (2); Vanguard (3); Payroll Integrations (4); Employee Benefits Security Administration (5); U.S. News and World Report (6)
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Sarah Sharkey is a personal finance writer who enjoys helping people make optimal financial decisions for their situation. She loves digging into the nitty-gritty details of financial products and money management strategies to root out the good, the bad, and the ugly. Her goal is to help readers find the best course of action for their needs.
