More than two-fifths of Americans have trimmed or halted their retirement plan contributions over the past year to manage everyday expenses, even as the Social Security system faces a projected benefit reduction of roughly 22% by 2032. Yet a new survey from TIAA indicates that most individuals are unaware of this looming shortfall, creating a compounding challenge for retirement security.
The research, titled Stretched Thin: Where Americans Stand on Affordability, Retirement, and Social Security, was conducted by KRC Research among 1,000 U.S. adults aged 18 to 65 between July 27 and July 31, 2026. The findings reveal a stark disconnect: while 80% of respondents view rising living costs and inflation as a direct threat to their retirement plans, only 20% said they were very aware that Social Security's trust fund is projected to run short by 2032, according to the 2026 Social Security Trustees Report.
One in five respondents (21%) said they first learned of the projected shortfall through the TIAA survey itself. If Congress fails to act, all beneficiaries would face an automatic, across-the-board benefit cut of approximately 22%, according to the same trustees report. This knowledge gap is particularly concerning given the heavy reliance on the program: 80% of respondents identified inflation as a threat, yet the program designed to anchor retirement income remains largely invisible in public consciousness.
Jim Johnson, Global Head of Government Relations and Public Policy at TIAA, emphasized the stakes: "The most consequential threat to Americans' retirement income is also one of the least understood. Every dollar pulled from retirement savings today is a dollar that's not invested and being multiplied for the future." The survey's findings align with a separate June 2026 Social Security Confidence Survey by PlanGap, which found that 69% of Americans aged 45 and older lack confidence that benefits will remain at current levels.
The day-to-day financial squeeze is driving measurable behavioral change. According to the TIAA survey, 43% of respondents either cut back (24%) or stopped (19%) retirement contributions in the past year to cover daily living costs. Only 7% were able to increase contributions, and 12% pulled money directly from retirement savings accounts to fund everyday expenses. Additionally, 54% named the cost of living as the single biggest systemic barrier to participating in the retirement system, outranking the complexity of the financial system (29%) and lack of access to employer plans (30%).
These behavioral shifts compound over time, leaving Americans more reliant on Social Security at the exact moment the program faces its most serious structural challenge in decades. As healthcare inflation at 280% of CPI further strains retiree budgets, the need for proactive planning becomes even more acute.
Despite the pressure, Americans are not passive. In response to the potential Social Security shortfall, 21% said they plan to rely more on personal savings and less on the program, 19% want to increase employer-sponsored plan contributions, and 19% plan to open or contribute more to an individual retirement account. Fifteen percent said they are actively seeking guaranteed lifetime income products, such as annuities, to replace what Social Security may not cover.
Jim Mullery, Head of Institutional Relationship Management at TIAA, urged plan sponsors to respond to this demand. "Plan sponsors should respond by making lifetime income a default feature of retirement plans," Mullery said. "Not just an accumulation vehicle, but an engine for generating income that lasts a lifetime." This aligns with broader industry trends, as insurers see RIAs as a top annuity opportunity in the coming years.
The role of financial advisors in bridging this gap is critical. When clients do not understand the Social Security shortfall, cannot quantify the impact of paused contributions, and are navigating real financial hardship, the planning conversation becomes more urgent and more consequential. A 2025 protected income study found that two-thirds of advisors had changed their retirement planning approach in the past year, with growing emphasis on annuities and protected income strategies as Social Security confidence erodes.
The TIAA survey also found that 90% of respondents agreed that every American should have access to retirement savings and the resources to manage them—a rare point of bipartisan consensus. Johnson said Congress should not ignore this. "In an era of sharp division, retirement security is a rare area of common ground," he said, "and Congress should treat it that way."
