Most non-retired investors (69%) between the ages of 55 and 65 concur that the traditional retirement age of 65 is irrelevant to their plans, as revealed in the ninth annual Advisor Authority survey by Nationwide, in partnership with the Nationwide Retirement Institute.

The survey, fielded in January and released Monday, indicates that 67% of pre-retirees anticipate encountering greater retirement hurdles than those experienced by their predecessors.

“Many of us watched our parents and grandparents enjoy a smooth transition to a secure retirement powered by traditional pension benefits,” Eric Henderson, president of Nationwide Annuity, said in a release with the research. “Today’s investors are having a tougher time picturing that for themselves as they grapple with inflation and concerns about running out of money in retirement.”

Unlike earlier generations, faith in conventional financial and retirement safety nets, such as Social Security, has diminished, the researchers found. The survey found 43% of respondents no longer rely on Social Security benefits as heavily as before, with 27% anticipating lower benefits than initially projected. Meanwhile, doubts regarding the sustainability of Social Security in retirement (38%) significantly contribute to pre-retirees reassessing or adjusting their retirement planning approaches.

Moreover, 41% of pre-retirees said out of necessity, they would keep working in retirement for additional income, while 27% said to achieve retirement goals they would have to live frugally.

Financial Adviser Approaches

Nationwide’s surveying also included financial advisers, with questions around how they advise clients on their retirement planning.

According to the survey, advisers have amped up their efforts to incorporate strategies to protect pre-retiree clients against market risk – more than six in ten (61%) advisers note either adopting strategies, or turning to annuities to manage risk, compared to 55% just five months ago. Annuities (79%) and diversification/non-correlated assets (77%) rank as the most popular solutions used to help clients protect their assets.

Many of these advisers also noted that they are looking to help clients achieve financial stability in their post-career years, though still at rates below 50%, according to the survey. Among pre-retiree investors engaging with their advisers, 49% discuss building up adequate savings for retirement, 38% talk about implementing tax planning strategies and 33% cover converting saved funds into retirement income. 

Only about a quarter of advisers are counseling pre-retiree clients on matters such as the optimal timing for claiming Social Security benefits (28%), tax-related considerations (23%) and planning for health care expenses in retirement (21%). When it comes to maximizing Social Security benefits by delaying withdrawals with bridging strategies, only 32% of advisers note they are discussing this strategy—though it does seem to be taking hold, as Nationwide found a rise by four percentage points in this category from five months prior.

“The final years leading up to retirement are a critical time for making decisions that can carry life-long implications,” Henderson said in the release. “Financial professionals can help this group create a holistic plan for addressing factors like Social Security, healthcare, long-term care, taxes and income in retirement …. Good advisers can identify gaps and create plans to address them before it’s too late.”

The study, commissioned by Nationwide and conducted by The Harris Poll, was carried out from January 8 to 23. It involved 518 advisers and financial professionals, as well as 2,346 investors aged 18 and above with investable assets totaling at least $10,000. Among the investors surveyed were 391 individuals aged 55-65, classified as pre-retirees.