This year, more Americans will turn 65 years old than at any point in history, with roughly 12,000 people a day reaching the age most target for retirement. A new survey from the Nationwide Retirement Institute® reveals that many adults in this age range are not as financially comfortable as they expected to be at this stage of life.

Nationwide surveyed 1,000 U.S. consumers ages 60-65 about their concerns, expectations and lessons learned for retirement planning. The survey found one-third of current retirees in this age range are considering returning to work, with half (50%) citing the fear of running out of money or currently running out of money as their top reason for doing so. Survey respondents say the biggest threat to their retirement security is inflation at 90%, followed by cuts to Social Security benefits (84%) and cuts to Medicare/Medicaid benefits (83%).

There is a significant gap between the realities of current retirees and the expectations of adults ages 60-65 who are still working. These include:

• Unrealistic estimates about basic living expenses: Current workers underestimate the percentage of income they'll spend on basic living expenses in retirement. They expect to spend 42% of their income on food, housing, and other basic expenses, while retirees actually spend 53% on those expenses.

• Lower retirement security than anticipated: 77% of respondents who are currently working say they expect to be comfortable in retirement, while only 68% of current retirees actually feel comfortable.

• Retiring ahead of schedule: 64% of current retirees stopped working earlier than planned, which can reduce important years to save for retirement. The average age of retirement was 60, while the average age of expectedretirement was 67.

• Safety net shortfall: 36% of retirees said they received less in Social Security benefits than they expected. If Congress does not take action, future retirees can expect a 23% cut in benefits, according to the Social Security Administration. Nearly three-fourths (74%) of current retirees said this cut would impact their retirement "a lot," with 71% of those still working saying the same. Only 41% of survey respondents expect Social Security to exist in its current form throughout their retirement.

"As we enter a period of peak retirement in our country, many retirees will face harsh reality checks if they missed opportunities to prepare for this moment," said John Carter, President and COO of Nationwide Financial. "For decades, millions of investors have focused on accumulation without a plan for how they will use that money to live in retirement. In the future, success will be determined based on whether or not retirees have enough income to cover their needs. With fewer young people able to count on defined benefit pensions and uncertainty around the future of Social Security, younger savers should focus on simple things they can control right now to set themselves up for success in the future. There is reason to be optimistic, but retirement savers need to act now to ensure success."

Advice respondents would give to their younger selves

Survey respondents have words of wisdom to pass down to younger generations. When asked what advice they would give their younger selves about retirement planning, many emphasized the difference between what they expected and what they experienced.

• Almost a quarter of survey respondents (23%) said to expect you'll need more money than you think.

• Nearly 1 in 5 (18%) said not to assume you can work for as long as you'd like.

• The vast majority gave tried and true advice, including start saving early (63%), start planning early (41%), and don't live above your means (34%).

• Retirees cited working with a financial professional, saving early, maxing out retirement plan contributions and retirement plan auto increases as actions that most helped their retirement security.

• Bad investments, extravagant purchases, tapping retirement savings early and waiting until after age 30 to start saving were cited as actions that most harmed their retirement security.

"These words of advice from those who have reached retirement provide great points of reference for American savers at every stage of the retirement planning journey," Carter said. "As American workers prepare for their retirement years, which could be sooner than anticipated and last longer than they may expect, it's crucial that they lean on the guidance of financial professionals who can help them make the right financial decisions and avoid costly mistakes."

Guidance from financial professionals is key

Survey findings show that not enough people are drawing on professional resources. Only 37% of 60–65-year-olds get information about retirement planning from a financial advisor. Others rely on a mix of sources, including the internet (39%), friends and family (35%) and resources from their employer-sponsored retirement plan (31%). One in 10 older respondents have not yet sought out information about retirement planning.

This reluctance to seek professional guidance poses a significant threat to long-term financial well-being and can lead to uninformed decisions that have lifelong consequences. For example, nearly two-thirds of retirees (58%) opted to draw down Social Security before their retirement age and 34% accessed their retirement savings early. Nearly 1 in 5 (17%) took a loan from their 401(k)s, risking tax and other withdrawal penalties.

"One of the most crucial tasks of our time is to ensure American workers understand how everyday choices impact their financial futures," added Carter. "It's important for those preparing for retirement to have a holistic plan, addressing factors like the right time to take Social Security, costs of healthcare and long-term care and ways to ensure they don't outlive their income. The best way to do that is to work with a trusted financial professional who specializes in protected income solutions or tap some of the educational resources that may be available through workplace retirement plans."

Find a financial professional

Nationwide remains committed to empowering individuals and financial professionals with the knowledge and tools they need to make informed financial decisions, especially when it comes to retirement planning. The company's diverse portfolio of protection solutions includes annuities, life insurance, workplace retirement plans and other solutions to help retirement savers and businesses address a wide range of challenges like achieving lifetime income, preparing for long-term care and healthcare costs in retirement, developing strategies for Social Security, legacy planning and more. 

For more information on Nationwide's retirement planning resources and to access the complete survey findings, view this infographic (PDF), complete survey results (PDF) , our website, or the Nationwide Advisor Advocate Blog.