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Unlike market risks, health-related risks are rarely temporary. Chronic illness, cognitive decline, and extended-care needs tend to develop gradually and persist over time, often creating sustained financial pressure when individuals have limited ability to adjust income or spending.

Many Americans now spend 10 or more years managing health challenges later in life. While Medicare provides essential coverage, it leaves meaningful gaps — particularly for long-term care. Extended-care costs can quickly erode savings, disrupt income strategies, and undermine retirement confidence.

As a result, health-related events are no longer a fringe concern in retirement planning — they are increasingly central to financial outcomes.

Informed, but Unprepared

LIMRA Retirement Income Institute research consistently shows that consumers recognize health and long-term care costs as major retirement risks, yet feel unprepared to manage them. Many believe a healthcare-related expense shock would seriously threaten their financial security, even if it occurs relatively late in retirement.

This gap is especially evident among Gen X. Often balancing caregiving for aging parents while preparing for retirement, many Gen X workers also lack access to traditional pensions and are more dependent on personal savings and employer-sponsored benefits. For this group, retirement risk feels immediate, personal, and difficult to plan around.

The Workplace Opportunity

These concerns are surfacing as the workplace benefits landscape continues to evolve. Employers are navigating higher costs, tighter budgets, and increased demand for benefits that feel relevant across generations. In response, many are moving toward more flexible, voluntary, and targeted benefit offerings.

Long-term care solutions — particularly those delivered through the workplace — are gaining renewed attention. Whether through voluntary benefits, hybrid protection products, or education and planning tools, employers have an opportunity to help workers address one of the most consequential retirement risks before it becomes a crisis.

When integrated effectively, these solutions can support employee financial wellness, help protect retirement savings, and enhance the overall value of the benefits package.

Redefining What Retirement Security Means Today

As healthcare and long-term care costs continue to rise, retirement security is increasingly defined by resilience, not just returns. Investment performance still matters, but it is no longer the sole driver of confidence in retirement.

Aligning workplace benefits with the realities of aging, caregiving, and long-term health risk represents a meaningful opportunity for employers, financial professionals, and the industry. By broadening the conversation beyond traditional financial risks, the workplace can play a more central role in helping Americans prepare for a longer, more complex retirement.