Retirement Retirement Planning

10 Biggest Fears Middle-Class Workers and Retirees Have (And How To Combat Them)

Understanding these fears can help you plan your golden years with more confidence.

By Adam Palasciano

Edited by Chris Kissell

Updated Dec. 24, 2024

Retirement should be a time of relaxation and freedom. But for many middle-class folks, it’s also a period filled with worry.

Middle-class workers and retirees are deeply concerned about financial security, health challenges, and the rising cost of living, according to the 2024 Transamerica Retirement Survey, which polled nearly 6,000 adults ages 19 and older with incomes between $50,000 and $199,000.

Fortunately, by identifying key concerns and taking proactive steps, retirees can address these challenges and work toward a more stress-free retirement. Here are the biggest concerns of retirees in the middle class.

Steal this billionaire wealth-building technique

The ultra-rich have also been investing in art from big names like Picasso and Bansky for centuries. And it's for a good reason: Contemporary art prices have outpaced the S&P 500 by 136% over the last 27 years.

A new company called Masterworks is now allowing everyday investors to get in on this type of previously-exclusive investment. You can buy a small slice of $1-$30 million paintings from iconic artists, all without needing any art expertise.

If you have at least $10k to invest and are ready to explore diversifying beyond stocks and bonds,see what Masterworks has on offer. (Hurry, they often sell out!)

Outliving savings and investments

Percentage of middle-class retirees who expressed this fear: 40%

With longer lifespans and rising costs, many worry that their nest egg won’t last throughout retirement. This fear is especially prevalent among those relying solely on Social Security who do not have significant pension or investment income.

Creating a detailed budget to track expenses and identifying areas to cut costs can help. Also, think about working with a financial advisor to develop a sustainable withdrawal strategy.

Want to learn how to build wealth like the 1%? Sign up for Worthy to get ideas and advice delivered to your inbox.

Experiencing declining health that requires long-term care

Percentage of middle-class retirees who expressed this fear: 40%

The possibility of deteriorating health weighs heavily on many of us. Chronic conditions and age-related illnesses often require costly care, draining financial resources.

To shield yourself from financial hardship due to declining health, make sure you purchase a comprehensive health insurance plan or Medicare coverage. Prioritize preventative care by maintaining a healthy diet, exercising, and attending regular checkups.

Watching Social Security benefits disappear

Percentage of middle-class retirees who expressed this fear: 39%

Many folks worry about the future of Social Security, fearing that benefits may shrink or disappear due to funding shortfalls. Given the program's uncertain solvency, retirees feel apprehensive about relying on it as a primary source of income.

Instead of relying on Social Security benefits for your financial future, diversify retirement income streams with 401(k)s, IRAs, and savings accounts.

Get a free stock valued between $5 to $200

Secret: You don't need thousands of dollars to buy thousand-dollar stocks or create a diverse portfolio.

Robinhood offers a method of investing called “fractional shares.” On its own, one share of a single stock could cost a lot of money, making it difficult to diversify. Robinhood allows you to buy pieces of stock instead, so you have the option to build a diverse portfolio quickly.

Let’s say you want to invest $250, as an example.

With that amount, you could build a relatively diverse portfolio with an investment of $50 in a big tech stock, $50 in a retail stock, $50 in an energy stock, $50 in a manufacturing stock, and $50 in a bank.¹ This content is for informational purposes only, you should not construe any such information as legal, tax, investment, financial, or other advice. To get stock reward, new customers need to sign up, get approved, and link their bank account. Stock rewards shares cannot be sold until 3 trading days after the reward is granted and the cash value of the stock rewards may not be withdrawn for 30 days after the reward is claimed. Stock rewards not claimed within 60 days may expire. See full terms and conditions at <a href="https://robinhood.com/us/en/support/articles/open-account-pick-your-stock/">rbnhd.co/freestock</a>. Fractional shares are illiquid outside of Robinhood and are not transferable. Not all securities available through Robinhood are eligible for fractional share orders. For a complete explanation of conditions, restrictions and limitations associated with fractional shares, see the Fractional Shares section of our Customer Agreement. Robinhood Gold is offered through Robinhood Financial LLC and is a membership offering premium services available for a fee.

Even better news? Add a Robinhood Gold membership, and you’ll get access to 4.25% (as of 11/15/24) APY² Annual Percentage Yield. Rate valid as of April 12, 2024. To earn interest, a cash balance is needed. If you have a margin balance, there is no cash balance to earn interest. Interest rates for cash sweep and margin investing can change at any time. Fees may reduce interest earnings. on your uninvested cash³ Interest is earned on uninvested cash swept from your brokerage account to partner banks. Partner banks pay interest on your swept cash, minus any fees paid to Robinhood. As of Nov 15, 2023, the Annual Percentage Yield (APY) that you will receive is 1.5%, or 5% for Gold customers. The APY might change at any time at the partner banks' or Robinhood's discretion. Additionally, any fees Robinhood receives may vary and are subject to change. Neither Robinhood Financial LLC nor any of its affiliates are banks. All investments involve risk and loss of principal is possible. Robinhood Financial LLC (member SIPC), is a registered broker dealer. and the ability to buy and sell stocks 24 hours a day, 5 days a week.

Open and fund a Robinhood account and earn up to $200 in stock

Being diagnosed with cognitive decline

Percentage of middle-class retirees who expressed this fear: 33%

A diagnosis of dementia is another significant concern, not only because of the emotional toll but also due to the financial burden of specialized care. While there’s currently no cure for dementia, treatment and care can be prohibitively expensive.

Being proactive can mitigate the impacts of such illness in your old age. Create a plan early, including a power of attorney and advance directives. Save for memory care services early on, and encourage open conversations with loved ones to develop a care plan that meets your preferences and budget.

Inability to afford long-term care

Percentage of middle-class retirees who expressed this fear: 32%

Long-term care services can be prohibitively expensive. Many people worry about how they’ll afford these services if they or their spouse need them, especially since Medicare does not cover most types of long-term care.

You might consider purchasing long-term care insurance to offset potential costs. Also, research state-specific programs that provide financial assistance for elder care, and discuss your long-term care options with family members.

Not being able to meet basic financial needs

Percentage of middle-class retirees who expressed this fear: 30%

During our working years, many of us scrape by, living paycheck to paycheck. Worrying about paying the bills is a constant fear.

Those worries can carry over to retirement. In fact, some may find them increasing once they no longer have a steady paycheck. Taking a part-time job during retirement might help reduce your fears.

Grow Your $$: 11 brilliant ways to build wealth after 40

Losing independence

Percentage of middle-class retirees who expressed this fear: 29%

One of the toughest realities of aging is the prospect of losing independence. After decades of autonomy, many retirees have to give up some level of control as their bodies and minds age.

Eating right, exercising, and taking other measures might help to delay the day of reckoning, but losing independence will be a reality for many of us.

Struggling to access affordable health care

Percentage of middle-class retirees who expressed this fear: 25%

Health care costs were rising long before the recent bout of inflation took hold, and costs show few signs of stabilizing.

If you have money left in a health savings account (HSA), you can help mitigate some of these expenses. But as you grow older and need more medical care, costs are likely to rise.

Feeling isolated and alone

Percentage of middle-class retirees who expressed this fear: 24%

Many people who pass the age of 50 find their friends and social contacts beginning to dwindle. This can lead to feelings of isolation and loneliness.

But it doesn’t have to be that way. The world is full of good causes that need volunteers or younger people who need mentors. If you are proactive, you can avoid loneliness and isolation.

Earn up to a $300 bonus and grow your money with up to 4.00% APY

This powerful combination checking + savings account from SoFi® allows you to earn up to a $300 bonus with direct deposit and grow your money with up to 4.00% APY.⁴ New and existing Checking and Savings members who have not previously enrolled in Direct Deposit with SoFi are eligible to earn a cash bonus of either $50 (with at least $1,000 total Direct Deposits received during the Direct Deposit Bonus Period) OR $300 (with at least $5,000 total Direct Deposits received during the Direct Deposit Bonus Period). Cash bonus will be based on the total amount of Direct Deposit. Direct Deposit Promotion begins on 12/7/2023 and will be available through 1/31/2026. Full terms at <a href="http://sofi.com/banking">sofi.com/banking</a>. SoFi Checking and Savings is offered through SoFi Bank, N.A., Member FDIC. SoFi members with Direct Deposit can earn 4.00% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. There is no minimum Direct Deposit amount required to qualify for the 4.00% APY for savings (including Vaults). Members without Direct Deposit will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Interest rates are variable and subject to change at any time. These rates are current as of Dec. 3, 2024. There is no minimum balance requirement. Additional information can be found at <a href="http://www.sofi.com/legal/banking-rate-sheet">http://www.sofi.com/legal/banking-rate-sheet</a>

This is one of the top accounts we’ve seen, and offers like this can be rare. You work hard, and now it’s time to make your money work for you — with SoFi, you can grow your money with hardly any effort!

SoFi has no account or overdraft fees⁵ Overdraft Coverage is limited to $50 on debit card purchases only and is an account benefit available to customers with direct deposits of $1,000 or more during the current 30-day Evaluation Period as determined by SoFi Bank, N.A. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Members with a prior history of non-repayment of negative balances are ineligible for Overdraft Coverage. and additional FDIC insurance up to $2 million on deposits is available through a seamless network of participating banks.⁶ We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Checking & Savings Fee Sheet for details at <a href="http://sofi.com/legal/banking-fees/">sofi.com/legal/banking-fees/</a> ⁷ SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $2M through participation in the program. See full terms at <a href="http://sofi.com/banking/fdic/terms">SoFi.com/banking/fdic/terms</a> See list of participating banks at <a href="http://sofi.com/banking/fdic/receivingbanks">SoFi.com/banking/fdic/receivingbanks</a> Plus, you can receive your paycheck up to 2 days early.⁸ Early access to direct deposit funds is based on the timing in which we receive notice of impending payment from the Federal Reserve, which is typically up to two days before the scheduled payment date, but may vary.

How to earn up to $300: Sign up and make a direct deposit within the first 25 calendar days of the promotional period, then collect a $300 cash bonus with a direct deposit of $5,000 or more.

SoFi is a Member, FDIC. ⁷ SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $2M through participation in the program. See full terms at <a href="http://sofi.com/banking/fdic/terms">SoFi.com/banking/fdic/terms</a> See list of participating banks at <a href="http://sofi.com/banking/fdic/receivingbanks">SoFi.com/banking/fdic/receivingbanks</a>

Open your SoFi account and set up direct deposit

Inability to find affordable housing

Percentage of middle-class retirees who expressed this fear: 21%

The cost of shelter has gone through the roof in cities from coast to coast. Simply finding and maintaining a place to live is a challenge for many.

Older folks might find more affordable housing in places that cater to residents who are 55 or older. But no matter where you live, housing is likely to be expensive.

Bottom line

While these fears are very real, they don’t have to dictate your retirement. With proper planning, you can mitigate risks and take control of your future.

As you reflect on your retirement plan, ask yourself whether you are taking the right steps to address these potential challenges. Proactively tackling these fears today can help you prepare for retirement with greater confidence and security.

More from FinanceBuzz:

Invest in Paintings by Basquiat, Picasso, Banksy

Masterworks Benefits

Invest in art like a millionaire for a relatively low cost
Art investments have outperformed the S&P 500 by over 131% for 26 years
Purchase shares of artwork by top artists
Hedge against inflation and diversify your portfolio

Visit Masterworks