Fewer retirees are relying on their savings alone, according to the 9th annual Nationwide Retirement Institute’s (NRI) Advisory Authority study, which found 31 percent of retirees expect to be less secure in retirement than their parents and grandparents. 

Enhanced economic pressures paired with smaller retirement savings have retirees struggling to make ends meet when it comes to their daily living expenses. More than 26 percent of retired investors reported they were continuing to pay off their mortgage, while 25 percent said they were paying down credit card debt. 

The NRI reports that while most Americans had planned on a retirement that included leisure and travel, this is far from the reality for many retirees. Approximately 39 percent of retired investors said they were spending less on entertainment in order to meet financial commitments in today's economic environment, and 34 percent said they are taking fewer trips or vacations.

“The picture of life after retirement has changed for many people as economic stressors continue to weigh on retired investors," said Mike Morrone, vice president of Nationwide Annuity Business Development. "Now is the time for advisors and financial professionals to check in with their clients and help them remain calm, nimble and informed in the face of continued economic headwinds, ensuring the plan they have in place continues to position them for a secure retirement."

The report found that 22 percent of retired investors are drawing more funds from retirement accounts, intensifying the traditional decumulation stage. This has prompted many investors to shore up their savings, with 63 percent saying they have a strategy in place to protect their assets against market risk, up from 54 percent compared with 2023.

The NRI said retirement plans look “radically different” from previous generations, with 12 percent of retirees abandoning the spending rule that ensures they have 70 percent to 80 percent of their pre-retirement income per year in retirement. A further 11 percent said they are foregoing the 4 percent rule, which advises against withdrawing 4 percent of their retirement portfolio each year when retired.

The NRI reports more retired investors are also initiating conversations about legacy planning and wealth transfer with their heirs, with 32 percent of respondents reporting they are discussing wishes for end-of-life care and death. Just 34 percent are discussing the financial details of their estate with heirs.

The NRI said more clients are looking to generate additional income and are refocusing their priorities. The company said 16 percent of retirees are now supplementing income out of necessity. 

“Advisors are recognizing and acknowledging investors' desire to avoid making the wrong moves in retirement," Morrone said. "They can help clients feel more confident about their retirement plans by understanding their goals and anxieties, and helping them protect their savings and plan for income they won't outlive by reinforcing the value of different retirement solutions and products, like annuities."