Debt and Lower Savings Leave Black Americans Behind in Retirement Readiness

A report from the Employee Benefit Research Institute shows that Black Americans continue to face serious challenges in saving for retirement, even as their incomes grow.

The 2025 Retirement Confidence Survey, which included a special oversample of Black workers and retirees, found that the wealth gap remains wide at every income level. Among households earning $75,000 or more, only 33% of Black Americans reported having $250,000 or more in savings and investments, compared with 63% of non-Black Americans.

Debt remains a major obstacle. Sixty-three percent of higher-income Black households said debt is a problem, while only 45% of non-Black households at the same income level said the same. Nearly half of upper-income Black respondents said debt affects their ability to save or live comfortably in retirement.

While many Black Americans expressed confidence in managing day-to-day budgets, fewer felt prepared to invest or plan for the long term. 

The study showed that Black Americans with higher incomes were less likely to have personally saved for retirement — 77%, compared to 87% of non-Black Americans.

Retirement experiences also differed sharply. Forty-four percent of Black retirees said they retired earlier than planned because of a health problem or disability, compared with 32% of non-Black retirees. After leaving their main jobs, Black retirees were more likely to work for pay to make ends meet and more often said their retirement lifestyle was worse than expected.

Access to financial advice and planning remains uneven. Just 31% of Black respondents reported currently working with a financial adviser, although nearly half expect to do so in the future. Black Americans were more likely to seek help with reducing debt, creating wills or estate plans, and arranging life insurance, rather than simply determining if they had saved enough to retire.

Black workers also expressed high interest in innovative retirement products. According to the report, 85% of Black employees with workplace savings plans stated that they were somewhat or very interested in using some or all of their retirement savings to purchase a product that guarantees a monthly income for life. Seventy percent said they would buy an insurance product that begins providing guaranteed income at a later age, such as 80 or 85, a higher percentage than the 59% of non-Black workers who expressed the same sentiment.

When asked about converting workplace savings into monthly retirement income, Black Americans were more likely to find each of the options appealing. For example, 75% favored a default investment option that includes guaranteed lifetime income features, while 73% liked the idea of an employer-selected platform to help them choose income solutions.

The survey also showed differences in expected sources of income during retirement. Nearly 9 in 10 Black workers and retirees said they expect to rely on Social Security. However, Black retirees were more likely to depend on financial support from family or friends and on disability insurance income, while non-Black retirees were more likely to rely on personal investments and workplace savings plans.

Participation in workplace retirement plans is increasing, but it remains uneven. Among Black workers earning less than $35,000, 41% reported being offered a workplace retirement plan. That figure rose to 86% for higher-income workers. Across all income levels, approximately 9 in 10 workers who were offered a plan reported being satisfied overall. Satisfaction levels were similar between Black and non-Black workers when they were asked about plan features, investment choices, tools for calculating retirement needs, and fees.

The report highlighted a strong appetite for new plan features that could help address financial vulnerabilities. Eighty-eight percent of Black workers said they would likely use an emergency savings account funded through payroll deductions, compared with 68% of non-Black workers. Black workers also showed more interest in features that would allow student loan payments to qualify for employer matching contributions to retirement plans.

Researchers Craig Copeland and Lisa Greenwald wrote, “Black Americans reported disproportionately lower financial resources, and how they feel about retirement and financial security is clearly impacted by having less resources.” 

They said, Black retirees, in particular, are “struggling with higher likelihoods of their retirement lifestyle being worse than expected” and “having to retire earlier than planned because of a health problem or disability.”

However, the researchers concluded that there is hope. 

“There are some modifications in the financial system that could help improve their prospects,” they said, “such as increased assistance in balancing competing financial priorities like debt reduction, supporting family, and building long-term savings.”