Retirement Readiness Measure Shows Dire Situation for Most

December 4, 2013 ( – Fifty-five percent of Americans are in fair or poor condition when it comes to being able to completely cover estimated essential living expenses in retirement, research finds.

By Rebecca Moore | December 04, 2013
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According to Fidelity Investments’ new Retirement Preparedness Measure (RPM), which is based on data from Fidelity’s 2013 Retirement Savings Assessment survey, essential living expenses in retirement includes housing, health care and food. The RPM introduces a single score that provides a comparison across generations, combining survey data with the retirement planning methodology Fidelity makes available to its customers.

Under the RPM, working Americans fall into four categories on the retirement preparedness spectrum. The categories are linked to a numeric range (the higher the better), based on an individual’s ability to cover estimated retirement expenses, even in a down market:

  • Dark Green: Very Good or Better (95 or over). These households are on track to cover 95% or more of total estimated expenses, even in a down market—33% of those surveyed were dark green.
  • Green: Good (80 to 95). On track to cover at least essential expenses, but not discretionary expenses like travel, entertainment, etc.—12% of those surveyed were green.
  • Yellow: Fair (65 to 80). Not on track to sufficiently cover all essential retirement expenses, with modest adjustments to their planned lifestyle likely—14% of those surveyed were yellow.
  • Red: Poor (less than 65). Not on track to sufficiently cover all essential retirement expenses, with significant adjustments to their planned lifestyle likely—41% of those surveyed were red.


According to the RPM, many Americans are likely to fall short of meeting their retirement income goals, unless they act soon. The median score indicates working Americans are on track to meet just 74% of their estimated retirement expense goals and face a 26% income gap, placing them in the “yellow zone” and forcing them to make spending cuts in retirement that may diminish their quality of life—especially if the market experiences a severe downturn.