They contributed to their 401(k) for decades. They watched their spending. They retired with a number they believed would last.
Then the world changed. And the math stopped working the way they expected.
A new wave of research published this year tells the story in numbers that are difficult to ignore. Nearly half of all retirees say their retirement expenses are higher than they planned, according to Schroders’ 2026 U.S. Retirement Survey. 90% of retirees remain concerned about inflation eroding the value of their assets. 29% of retired Americans have no money saved at all. And the average retiree now believes they need $823,800 to retire comfortably — nearly a quarter million dollars more than they thought just one year ago.
Something has changed. Understanding what — and what to do about it — is one of the most important conversations a retirement saver can have right now.
Social Security Is Not Keeping Up
For millions of Americans, Social Security is not a supplement to retirement income. It is the retirement income. The Federal Reserve puts median retirement savings among 65 to 74-year-olds at just $200,000. That is not a lot of money to stretch across 20 or 30 years of retirement. For the tens of millions of seniors with savings at or below that level, Social Security is the difference between getting by and not.
The problem is that Social Security is losing the inflation battle.
The 2026 cost-of-living adjustment came in at 2.8% — adding an average of $56 per month to benefit checks. That sounds like something until you compare it to August’s Consumer Price Index reading of 3.4%. Seniors received a 2.8% raise in a year when prices rose 3.4%. Their purchasing power declined before the check arrived.
It gets worse. The 2026 Social Security Trustees Report — released in June and updated this summer — now projects the program’s main trust fund will be depleted in the fourth quarter of 2032. One quarter earlier than last year’s projection. Without congressional action, that depletion would trigger an automatic 22% reduction in scheduled benefits for every recipient regardless of how long they paid into the system.
“We have a real retirement crisis in this country,” said Drew Powers, founder of Illinois-based Powers Financial Group. “Today’s retiree does not look like previous generations’ retirees. Long gone are the days of 30 stable years, a gold watch, a pension, and health benefits.”
The 2032 deadline is six years away. It is close enough to affect the retirement plans of anyone reading this.
The Expenses Nobody Budgeted For
Ask a financial planner what most retirement plans get wrong and the answer comes back the same way every time.
Healthcare.
Medicare covers a meaningful portion of medical costs but it has well-documented gaps. Dental care is largely excluded. Vision is excluded. Hearing aids are not covered. Long-term care — which a significant percentage of retirees will eventually need — is a separate and often devastating financial conversation. And the costs that Medicare does cover come with premiums, deductibles, and out-of-pocket maximums that have been rising faster than general inflation for years.
Then there is everything else that has gotten more expensive. Groceries. Gasoline. Utilities. Property taxes. Insurance premiums of every kind. These are not categories that retirees can easily cut. They are the fixed costs of daily life — and they have been rising at a pace that a 2.8% COLA does not come close to covering.
Seniors who rely heavily on Social Security are already feeling the squeeze, CBS News reported this month. Their 2026 COLA was below April’s inflation rate, meaning Social Security benefits have already lost purchasing power in real terms this year.
“Retirees are fighting the affordability crisis with a fixed pool of assets and no second chances,” said Deb Boyden, head of U.S. defined contribution at Schroders.
That phrase — no second chances — is the one that should stay with every retirement saver. Workers who fall behind can increase their income, pick up additional hours, or delay a purchase. Retirees drawing down a fixed pool of assets in an inflationary environment have none of those options. Every dollar of purchasing power lost to inflation is permanently gone.
Tapping Savings Earlier Than Planned
One of the clearest signals that something has gone wrong in the retirement math is the growing number of retirees who are withdrawing from their savings significantly earlier than they planned.
Rising healthcare costs, persistent inflation, caregiving responsibilities, and unexpected emergencies are forcing many seniors to dip into savings that were supposed to last decades, according to recent research from SavingAdvice. What was intended to be a carefully managed nest egg is increasingly being used to cover immediate needs — shortening its lifespan by years.
This pattern has a compounding effect that makes it particularly damaging. Early withdrawals reduce the principal that would otherwise be generating returns. A smaller pool compounds more slowly. The gap between what a retirement was supposed to provide and what it actually provides widens every year that withdrawals exceed the plan.
Two-thirds of retirees say inflation has erased the value of their hard work and savings, according to the Clever Real Estate 2026 Retirement Survey. 59% do not feel their retirement financial strategy is keeping up with added costs. And 6 in 10 Americans overall worry they will not be able to retire on their own terms, according to a separate Allianz study.
These are not marginal concerns from the financially unprepared. They are the documented experiences of people who saved, who planned, and who are discovering that the plan was built for a world that no longer exists.
What Changed
The retirement model that most Americans have been following was designed for a specific set of conditions. Inflation averaging around 2%. Bonds providing reliable income and stability. Social Security paying as projected. Healthcare costs rising modestly. A 30-year career followed by 20 years of retirement.
Since 2021, almost every one of those conditions has changed.
Inflation ran above the Federal Reserve’s 2% target for six consecutive years. The dollar has lost approximately 20% of its purchasing power in real terms since 2021 alone. The bond market — the safe half of millions of retirement portfolios — had one of its worst multi-year stretches in modern history. Social Security’s funding shortfall is accelerating. Healthcare costs continue to rise faster than general inflation. And life expectancy has extended the average retirement well beyond what most financial plans anticipated.
None of this means the retirement savers who followed conventional advice made a mistake. The advice was reasonable for the conditions in which it was given. The conditions changed. The advice has not always kept pace.
What Millionaire Retirees Did Differently
Here is what the data shows about the Americans who are not running out of money.
Ramsey Solutions surveyed more than 10,000 millionaires to understand how they built their wealth. 79% received no inheritance. Only 15% ever held a senior leadership role. Many never earned six figures in a single working year.
What they had in common was consistent saving inside tax-advantaged accounts over a very long period of time — and a deliberate allocation toward assets that hold their real value when the dollar does not.
Beyond stocks and bonds, the preferred hard assets among wealthy retirees are gold and real estate. Not because they are exciting investments, but because they are real. Their value is not denominated in a currency that loses purchasing power every year inflation exceeds the COLA adjustment. They do not decline when bond yields rise. They do not get debased when the government borrows another trillion dollars.
“When national debt headlines dominate the news cycle, we typically see a rise in retirement investors asking about diversification strategies outside traditional equities,” said Morgan Steckler, Senior Director at Priority Gold, who has spent more than four decades working in alternative assets. “People who have spent decades building wealth start doing the math and realizing their savings are entirely in dollar-denominated assets.”
That realization — that a portfolio of stocks, bonds, and cash is entirely exposed to the same inflation risk simultaneously — is what separates retirement plans that hold up from those that do not.
What You Can Actually Do Right Now
The picture is sobering. It is not hopeless. Here is what the data and the experience of successful retirees actually point toward.
Know your Social Security number — and stress-test it. Go to ssa.gov and pull up your projected monthly benefit. Now reduce it by 22%. Does your retirement budget still work if the 2032 trust fund depletion happens without congressional action? If the answer is no or maybe, that is information worth having now rather than in six years.
Take catch-up contributions seriously. If you are 50 or older, IRS rules allow additional catch-up contributions to retirement accounts. In 2026, that means up to $31,000 per year in a 401(k) and $8,000 in an IRA. An additional $7,500 per year from age 52 to 67, growing at a modest 6% annually, compounds to more than $190,000. That is a real number built from consistency and time.
Audit what your portfolio is actually made of. Most conventional retirement portfolios hold assets that are 100% denominated in U.S. dollars. Every one of those holdings loses purchasing power when the dollar does. Since 2021, that loss has been approximately 20% in real terms. Adding assets whose value is determined independently of the dollar — physical gold, physical silver — is not pessimism. It is the same risk management logic that has driven millionaire retirees to hold hard assets alongside their conventional savings for decades.
Understand what a precious metals IRA can do. A self-directed IRA can hold physical gold and silver using funds already in a 401(k) or traditional IRA, without triggering a taxable event during the rollover. Gains inside a traditional precious metals IRA compound tax-deferred. Inside a Roth, they can potentially be withdrawn entirely tax-free. It is not a replacement for Social Security or a conventional portfolio. It is the portion of your retirement that holds its purchasing power when everything else is losing ground to inflation.
The Bottom Line
The retirees running out of money faster than they expected are not, for the most part, people who made catastrophic mistakes. They are people whose plans were built for a world that has changed significantly in the past five years.
Inflation higher than the COLA adjustment. A Social Security trust fund moving toward depletion six years faster than projected. Bond markets that have failed to cushion stock losses. Healthcare costs that have outpaced everything.
The plan needs updating. The earlier that update happens — before the savings pool shrinks, before the shortfall arrives, before the options narrow — the more it can do.
The Americans who retire with enough are not the ones who saw everything coming. They are the ones who updated their plan when the conditions changed. That opportunity is still available. For now.
