BlackRock estimates annual income on $1 million cash holdings could decline to below $40,000 by late 2026 from $53,000 at peak rates.
Retirees who relied on money market funds for income are seeing yields shrink after the Federal Reserve cut rates from 2024 through 2025. A $1 million cash position now generates less than $40,000 annually, down from $53,000 at peak rates, according to BlackRock’s 2026 outlook.
U.S. money market fund assets reached $7.9 trillion in June 2026, while global balances neared $9.1 trillion. Confidence among retirees has declined, with only 27% feeling financially prepared, down from 43% in 2020.
The shift highlights risks of over-reliance on short-term instruments as rate environments change.