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Americans’ Retirement Literacy Is Lacking, And It Matters

February 12, 20243 min read


The American College of Financial Services recently published its fourth Retirement Income Literacy Study, marking a decade of comprehensive surveys aimed at assessing Americans’ understanding of crucial retirement planning issues. This latest iteration offers insights into the state of retirement literacy and unveils significant implications for individuals' financial futures.

Americans’ Retirement Literacy

1. Older Americans lack actionable retirement knowledge.

The study revealed that older Americans scored an average of only 31% on a 38-question retirement literacy quiz. This indicates a concerning gap in essential retirement planning knowledge among this demographic, raising questions about their preparedness for retirement.

2. The needle hasn’t changed.

Despite efforts to improve retirement literacy, including enhanced Social Security statements and mandated annual illustrations of lifetime income from 401(k) accounts, the study found that Americans continue to perform inadequately on key retirement planning questions. The persistence of this trend underscores the need for more effective educational initiatives.

3. There is a distinct advantage to getting help.

One notable finding from the study is the correlation between seeking expert advice and retirement literacy. Participants with ongoing advisory relationships scored significantly higher on retirement income literacy compared to those without such guidance. This underscores the importance of seeking professional assistance to bolster one's retirement planning knowledge and financial preparedness.

4. Significant differences in knowledge exist across demographics.

The study also highlighted disparities in retirement literacy across different segments of society. Respondents with higher levels of investible assets scored considerably higher on the quiz than those with lower asset levels, underscoring the influence of socioeconomic factors on retirement knowledge. Additionally, variations were observed based on factors such as education level, gender, ethnicity, and employment status, emphasizing the need for tailored retirement planning approaches.


Understanding retirement planning is crucial for ensuring financial security and well-being in later years. The findings of this study underscore the importance of addressing gaps in retirement literacy and providing accessible resources and guidance to help individuals make informed decisions about their financial futures.

Access to Advice

Access to professional advice is instrumental in navigating the complexities of retirement planning. However, many individuals, particularly those in underserved markets, face challenges in accessing reliable financial guidance. Addressing these barriers and expanding access to advisory services is essential for promoting retirement preparedness and financial literacy.

Kind of Information

The type of retirement information needed varies across demographics and life stages. From investment strategies and tax considerations to Medicare and Social Security planning, individuals must acquire knowledge relevant to their unique circumstances. Tailored educational initiatives can help address specific informational needs and empower individuals to make informed retirement decisions.

What's Next?

To improve retirement literacy, individuals are encouraged to seek out educational resources and professional guidance. Whether through employer-sponsored programs, community workshops, or direct consultations with financial advisors, there are avenues available for enhancing retirement knowledge and planning effectively.


Retirement literacy plays a crucial role in shaping individuals' financial futures and ensuring retirement security. By addressing disparities in retirement knowledge and promoting access to reliable advice, we can empower individuals to make informed decisions and achieve greater financial well-being in retirement.

retirement literacyretirement planningfinancial educationfinancial advisory retirement income
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Edward Malekan

Founder and CEO of Eternity Financial Alliance. My journey in the finance and insurance industry has been fueled by a strong desire to be a trusted resource for individuals, families, and businesses seeking to secure their financial futures.

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