Equity markets are making record highs and economic optimism is on the rise, but American workers' confidence about retirement continues to lag, according to the 2017 Retirement Confidence Survey released Tuesday by the Employee Benefit Research Institute, which has produced the survey for 27 years. They have good reasons for feeling that way.

A substantial majority of working Americans still feel very or somewhat confident about having enough money to live comfortably throughout retirement (60%) – but that's down from 64% last year and 70% in 2007. Meanwhile, 39% say they are are "not too or not at all confident" about retiring comfortably, the highest level in the survey's history.

A Tale of Three Americas

While the bottom group is the largest ever, the tip of the American pyramid – people who are very confident about retirement finances – is smaller than it's been in decades. Just 18% of Americans feel that way this year, a notably smaller group than the 27% of respondents who felt very confident in 2007. Ten years earlier, in 1997, the figure was 24%. 

In 1993, the first year of the survey, 73% of respondents were very or somewhat confident about having the money to retire comfortably, the highest level in the survey's history. And only 25% of respondents were not too or not at all confident, the lowest level over the survey's history. 

What we get is a pattern of three Americas, with a small top level very confident, a 42% plurality feeling confident, and an almost-as-large 39% who aren't confident. The biggest inroads are on the mid-level group, which has shrunk from 55% when the survey began in 1993.

Stress Below the Surface

Underlying the confidence gap is a pervasive retirement-planning stress effect in many quarters. Three in 10 Americans say that preparing for retirement causes them to feel mentally and/or emotionally stressed. Additionally, three in 10 report worrying about their personal finances while at work and say they would be more productive if they didn't worry about their finances. (See also: Best Strategy for Short-Term Savings Goals)

On top of this, many Americans are doing nothing about their concerns. Just six in 10 say they have begun saving for retirement and only four in 10 have calculated how much they would need to save for retirement. "I continue to be struck by the relatively small share of workers who do formal retirement planning," Lisa Greenwald, co-author of the report told USA Today. 

"Some of these critical retirement planning steps don't cost workers anything, like estimating Social Security or thinking through what your expenses may be in retirement."

And Plan, Knowing This 

Other key findings of the Retirement Confidence Survey, the longest-running of its type, include:

  • Confidence among retirees (79%) about having enough money for retirement continues to be higher than among non-retirees. 
  • More than half of all workers say retirement planning (53%), financial planning (49%), or healthcare planning (47%) programs would help their productivity in the workplace. 
  • 47% say that their total household savings and investments, excluding their homes, amounts to less than $25,000. This includes the 24% who report they have less than $1,000 in savings. 
  • Nearly three in four workers who are not saving for retirement say they would be more likely to start if employers matched their contributions.

The survey is based on an online survey of 1,082 workers and 589 retirees, and has a statistical margin of error of plus-or-minus 3 percentage points for workers and 4.1 percentage points for retirees (see also: Journey Through the 6 Stages of Retirement).