+34
Workers are reducing retirement contributions, delaying savings and taking on second jobs as rising housing expenses, debt payments and everyday costs strain their budgets. The share of people increasing retirement contributions fell from 55% in 2025 to 39% in 2026, while many younger workers rely on side income to cover basic expenses.
Workers are muddling through rising day-to-day living costs by slowing retirement savings, reducing contributions to 401s, and taking on second jobs to fill the gap between income and expenses.
More than 1 in 3 full-time workers, and nearly half of Generation Xers, say their job either only covers current expenses or is not enough to allow them to feel like they are on solid financial footing, according to a new Goldman Sachs Asset Management"Retirement savings momentum appears to be stalling, and rising costs are broadly eroding savers' ability to save," Chris Ceder, a senior retirement strategist at Goldman Sachs Asset Management, told Yahoo Finance. More than 60% of workers are moonlighting with side gigs and contract work, mostly out of financial need.
While most Gen Z and millennial workers say their jobs provide financial stability, they don't act like it. Roughly 8 in 10 stepped into a side hustle in the past year because they felt they had to if they wanted to pay their bills.
"There are two important perspectives to consider: The good news is that today's job market offers a wide range of flexibility to take on secondary work," said Ceder. "But the concern is that much of this is driven by financial need rather than choice. " That extra income may offer some relief, but it's not translating to more retirement savings. The percentage of people who increased their retirement contributions fell from 55% in 2025 to 39% in 2026.
"This is the largest single-year decline in the percent of people who increased their retirement savings in six years, potentially highlighting a momentum shift," Ceder said. Retirement is 'paid last' My guess is if you're reading this column, you already know what's causing the disconnect — housing costs, day-to-day living expenses, and debt payments.
"These are the recurring, non-negotiable costs of ordinary life, which is precisely what makes them corrosive to retirement saving," Ceder said. "These expenses arrive every month, cannot be deferred, and they're paid first. Retirement is often paid last.
""The answer cannot be continuing to tell people to figure out how to save more," he said. "Reaching the levels of savings that people need is becoming much more difficult due to all of these factors. "In 2026, fewer people across all age groups said their retirement savings were on track, and most expect they will work longer than they planned.
Close to half of Americans retire earlier than age 65 due to health issues, a layoff, or caring for aging relatives, according to this data. The Employee Benefit Research Institute found that 3 in 5 retirees stopped working earlier than they expected to at 65, with a median retirement age of 62. In the Goldman survey, roughly half of retirees left the workforce anywhere from a year to five years sooner than planned.feel a bit better about the world.
More than 7 in 10 who have a retirement plan say their savings are on track or better, compared with 3 in 10 without a personalized plan. Nearly half of those with a plan also reported increasing their retirement savings in the last year, compared to about a quarter without one. Kerry Hannon is a Senior Columnist at Yahoo Finance. She is a career and retirement strategist and the author of 14 books, including"
Please follow us on Google to support usRetirement Savings 401(K) Contributions Living Costs Side Jobs Financial Stability
Canada Latest News, Canada Headlines
Similar News: You can also read news stories similar to this one that we have collected from other news sources.
Most Americans Blame Trump Policies for Rising Costs Ahead of MidtermsA new AP-NORC poll reveals that only 17 percent of U.S. adults approve of President Trump's handling of the cost of living, with a majority blaming his policies for persistently high prices as midterm elections approach.
Read more »
Rising Costs and Trade Tensions Put U.S. Fishermen at Odds with TrumpCommercial fishermen across the United States are facing rising fuel prices, trade tensions with Canada, staffing shortages at the National Marine Fisheries Service and other regulatory challenges. Complaints from the industry may hurt Republicans in the 2026 midterm elections, particularly in competitive races in Alaska, Washington and Maine, despite President Donald Trump's efforts to promote a pro-fishing agenda.
Read more »
Even high earners are living paycheck to paycheck this year: Goldman Sachs surveyRoughly 4 in 10 workers earning above $300,000 say they're living paycheck to paycheck.
Read more »
Dayton Workers Face Layoffs and Inflation Ahead of MidtermsThousands of workers in southwestern Ohio were laid off from the Navistar truck factory amid rising costs of living. Kyle Bos, a former employee who previously supported Donald Trump, expresses disillusionment over affordability issues. The economic struggles in Dayton, an area that has lost half its factory jobs since 1990, are influencing voter sentiment ahead of the midterm elections, where Republicans face challenges from Democrats harnessing local discontent.
Read more »