Everybody tries their best to amass an ironclad retirement savings. In terms of lifetime financial goals, building a safe and secure pension fund is right up there with finally paying off your mortgage. But for plenty of aspirational savers, retirement is feeling increasingly unreachable.
According to researchers at Goldman Sachs, 42% of workers don’t think they’ll be able to outlive their savings. That makes sense, given that 40% of Americans are living paycheck to paycheck.
Sound familiar? Well, you can stop stressing—because Elon Musk thinks that saving for retirement won't be an issue in the next couple of decades!
Earlier this month, the world’s richest man appeared on the podcast Moonshots with Peter Diamandis and touched on everything from U.S.-Chinese relations to robots and clean energy. But Musk’s most intriguing claim had nothing to do with oppressive trade tariffs or colonizing space. It was the suggestion that ‘future you’ would be able to stop squirreling money away for old age.
Why? Because AI will create so much abundance that everyone will have “whatever they want.”
That’s a bold claim and a huge leap. It’s also a pretty dangerous idea to take at face value if you’re trying to plan for your future. But it’s definitely worth taking a closer look at the principles behind Musk’s claim.
So, what is he actually saying about how AI will impact your finances in the future? And more importantly, is he right?
Elon Musk Envisions Abundance and Universal High Income
Before we dive into the mechanics behind Elon Musk’s AI utopian vision, let’s take a step back and look at what he’s actually saying.
According to Musk, we won’t have to save “for retirement in 10 or 20 years. It won’t matter.” Why? Because AI and robotics will drive productivity through the roof.
Musk thinks AI will become so capable that it’ll start producing everything we need at scale with minimal human cost. As a result, the cost of goods will drop significantly, and traditional economic constraints will begin to fade.
Translation: We’ll all benefit from a universally high income because resource scarcity will virtually disappear. As a result, there won’t be any point in saving for retirement because everything’s going to be so cheap that a pension will be made redundant.
That’s his dream, anyway. The reality is a lot different.
Is Elon Musk Right Or Just Dreaming Big?
Elon Musk is asking us to take a big leap from AI writing emails for you to a world where retirement planning is optional—and to be honest, it’s a reckless dream to be broadcasting.
Firstly, abundance is not and never will be equitable.
Let’s say Musk is absolutely correct in his assumption that AI and robotics will create huge gains in productivity. Those gains won’t automatically trickle down to everyone. In fact, history teaches us it’s a virtual impossibility. Technological revolutions always stratify rather than equalize income.
In his defense, a billionaire probably wouldn’t know that.
This universally high income Musk thinks we’ll all have in the future would also require an equitable distribution mechanism. That’s not something AI can generate. It would need to be a societal choice implemented by the government, and it’s difficult to picture that happening any time soon.
Moreover, Musk’s utopian dream seems to forget the inescapable fact that scarcity isn’t just about the consumer goods that AI and 3D printing can create. People still need access to services like healthcare, energy, transportation, housing, and everything in between. Some of that can be automated, sure. But a lot of it involves human preference and personal choices that can’t be scaled like a Tesla (TSLA) assembly line.
We all want different things, which makes lifestyle costs variable.
Yet above all else, transition risk matters.
Musk has admitted the big shift to this pension-free future will be “bumpy.” But if you’ve been affected by the unemployment churn we’re already seeing as a result of supply chain shifts, automation scares, and industry disruption, that’s the understatement of the millennium.
If AI does put millions of Americans out of a job without a clear path to a universal income, we’re going to be dealing with generations worth of mass underemployment long before we reach the era of abundance. And that transition period will make retirement planning even more important than it is in 2026.
Yeah… Don't Bet on It
Long story, short: Don’t throw away your 401(k).
AI can automate tasks that people used to do, and loads of companies are already using it to augment human labor and reduce time spent on repetitive jobs. Meanwhile, AI could theoretically be deployed to enable new social safety nets like a universal high income if government will and adequate policy existed to support it.
But for now, this is all pie-in-the-sky ideation.
Our social systems aren’t built for this post‑scarcity world of tomorrow, and you live in the real world of today. So, please save for your retirement. This is your future we’re talking about, and we both know you can’t afford to treat a billionaire futurist’s optimistic vision like real financial advice.
On the date of publication, Nash Riggins did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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