Many Americans are struggling to save for retirement, even if they have access to a workplace retirement plan. Schwab’s annual survey of 401(k) participants found that there are a number of obstacles savers are facing in 2025 that are making it difficult to achieve their desired retirement nest eggs.
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Here’s a look at the top obstacles 401(k) users are facing when it comes to saving for retirement — and what they can do to get over them.
Inflation Is Undermining Retirement Goals
Inflation is the primary obstacle to saving for a comfortable retirement, with 57% of survey participants stating that inflation is making it difficult to reach their goals.
To keep up with retirement savings despite inflation, you may need to adjust your budget.
“Instead of pulling back on 401(k) contributions, workers are reducing nonessential spending,” said Lee McAdoo, managing director at Schwab Retirement Plan Services. “Forty percent told us they’re buying less, and 39% are switching to cheaper products.”
If adjusting your spending doesn’t move the needle enough to save what you want for long-term goals, you may need to adjust your retirement savings target.
“Some are moderating expectations around what they will actually need in retirement,” McAdoo said. “It’s healthy to periodically reevaluate your needs and make sure that your current habits and goals are aligned with your lifestyle, especially as you get closer to retirement.”
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Everyday Costs Are Squeezing Retirement Contributions
Over one-third (38%) of 401(k) participants say that it’s difficult to keep up with monthly expenses and save for retirement at the same time.
“It’s common for workers to be juggling multiple financial priorities,” McAdoo said. “Starting with a few fundamentals can make saving feel more manageable.”
First, aim to contribute enough to your 401(k) to receive the full employer match if one is offered.
“If you are able to save more while still keeping up with monthly expenses, consider bumping up your savings rate — even a 1% or 2% increase can make a big difference over time,” McAdoo said. “Most 401(k) plans offer automatic escalation, so you can set an annual increase when you get a raise, for example, and bump that contribution a bit before you ever notice it in your paycheck.”
Market Swings Are Difficult To Navigate
Stock market volatility is an obstacle for 33% of 401(k) participants, the survey found. However, the best course of action is to keep consistently investing for retirement, despite what the market may be doing.
“We often see higher engagement among savers in times of market uncertainty,” McAdoo said. “Our survey found that 23% adjusted their 401(k) portfolio due to economic conditions, including inflation and market volatility.”
While you may shift your strategy, the most important thing is that you keep investing.
“At a high level, 79% shifted to more conservative investments while 21% shifted to more aggressive investments,” McAdoo said. “If you’re thinking about making changes to your investments, it’s important to think beyond the current environment and ensure that your investment strategy matches both your long-term objectives and your personal tolerance for risk.”
If you’re unsure how to best deal with market swings, reach out to your 401(k) provider for help and guidance.
“Workers’ confidence in 401(k) investment decisions is much higher when they seek professional help,” McAdoo said. “Twenty-seven percent are very confident on their own, compared to 51% who would feel very confident with professional guidance.”
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This article originally appeared on GOBankingRates.com: Schwab Reveals 3 Big Retirement Obstacles Americans Face in 2025
