Over Half of Retirees Regret Missing This Crucial Factor in Their Retirement Plan

A comfortable retirement takes more than saving enough money. It also requires understanding how taxes will affect those savings. Yet many Americans fail to plan for this, which can lead to costly surprises once they stop working. According to a new survey from The Nationwide Retirement Institute®, most respondents now admit they didn't give enough thought to this crucial piece of their financial future.

If you want to avoid money mistakes that drain your nest egg, it's worth learning from their regrets.

Nationwide's 2025 Social Security Survey explained

The Nationwide Retirement Institute's 2025 Social Security Survey, conducted online by The Harris Poll between June 2 and July 10, 2025, included 1,812 U.S. adults aged 18 and older who currently receive or expect to receive Social Security benefits. 

The group spanned generations — Gen Z, Millennials, Gen Xers, and Boomers+ — giving a clear picture of how Americans across age groups are thinking about retirement.

The findings reveal widespread anxiety about taxes, Social Security's long-term outlook, and overall financial readiness for retirement, even among those who have already left the workforce. Here's what the survey found.

Two-thirds of non-retirees are terrified of how tax rates will impact their savings

The survey found that 65% of non-retirees fear the effect that tax rates could have on their retirement income — a clear sign that many have not factored tax obligations into their planning.

Many retirees may assume their tax burden drops automatically once they stop working, but withdrawals from traditional IRAs, 401(k)s, and even a portion of Social Security benefits may be taxable. This fear highlights how crucial it is to understand how different income sources are taxed and the need to plan withdrawals strategically to preserve long-term wealth.

Six out of 10 wish they had prepared better for paying taxes in retirement

In the survey, 59% of respondents said they regret not preparing for how taxes would affect their savings.

For example, many retirees may discover too late that their required minimum distributions (RMDs) or Social Security benefits can push them into higher tax brackets, shrinking their take-home income. Tax planning during your working years, such as converting some savings to a Roth IRA or diversifying income sources, may help minimize this pain later.

More than four in five Americans are concerned about the longevity of Social Security

Social Security is a cornerstone of retirement income, yet 83% of Americans are worried about how long the system will last.

These concerns are valid: without decisive legislative action, Social Security's trust fund may face shortfalls within the next decade, which adds another reason to save independently to cover potential benefit reductions.

Half of retirees fear tariff changes could impact their retirement income

The survey showed that 50% of retirees are worried about how tariff changes or shifting economic policies could affect their retirement income.

While tariffs may seem unrelated to personal finance, they can potentially influence inflation, interest rates, and ultimately the cost of living, which are all factors that hit retirees' budgets hard.

More than four in 10 adults say they'd cut down on expenses if Social Security is reduced

When asked how they'd respond to a reduction in Social Security benefits, 41% of adults said they'd tighten their budgets.

While trimming discretionary spending can help, this response shows how few people have built flexibility into their long-term plans. A more sustainable approach may include setting up multiple income streams, such as dividends, part-time work, or passive income, to maintain stability regardless of benefit changes.

More than one-third of adults would work part-time in retirement

For many, working part-time is both a financial and emotional safety net. Nationwide's survey found that 36% of adults would consider part-time work to supplement income if Social Security benefits are reduced.

This strategy can help retirees preserve savings longer while staying active and socially engaged. Even modest earnings can offset benefit reductions or help delay withdrawals from investment accounts.

One in three non-retirees would start saving more independently

The survey indicated that 33% of non-retirees said they'd ramp up personal savings in response to Social Security uncertainty. That's definitely a smart move. The more you save independently, the more control you have over your tax strategy and withdrawal timing.

For example, creating a mix of tax-deferred, taxable, and tax-free accounts could help manage future liabilities and potentially make your income more predictable in retirement.

Steps to take for planning your retirement

While you can't control government policy or inflation, you can control your preparation. Build a diversified portfolio that includes tax-efficient accounts like Roth IRAs, and consider delaying Social Security to increase future benefits.

It's also wise to model your income needs annually to help ensure your withdrawal strategy aligns with changing tax brackets.

Work with a financial professional

A qualified advisor can help identify the most tax-efficient way to draw down your assets in retirement. They can also project how current tax laws or Social Security adjustments could affect your income over time.

Professional advice becomes especially valuable if you hold multiple account types or plan to work part-time while collecting benefits.

Reduce or eliminate high-interest debt

Carrying credit card or personal loan balances into retirement may erode your income and could increase your stress. Paying down high-interest debt before you retire can free up cash for essentials and may also help reduce necessary taxable withdrawals from investment accounts.

Overall, eliminating debt early may also make it easier to live on a fixed income.

Live below your means

Living modestly can be one of the most powerful tools for long-term security. It may help protect your savings from inflation, market swings, and tax surprises.

If you're spending less than your income, even in retirement, you'll have more flexibility to handle unexpected costs without jeopardizing your financial future.

Bottom line

The Nationwide Retirement Institute's 2025 Social Security Survey makes one thing clear: most retirees wish they'd thought more about taxes before leaving work. Taxes, tariffs, and benefit changes may be out of your control, but your preparation isn't.

Taking time to understand how your income sources interact can help you build a stronger, more resilient retirement plan that lasts for decades to come.