The transition from earning a regular paycheck to living off savings is hitting many Americans harder than expected, and a growing body of research shows that financial regret is becoming a defining experience of early retirement.

More than half of people who retired in the past five years already regret not saving enough, and nearly three in ten wish they had started saving earlier, according to research from the Nationwide Retirement Institute. 

The findings paint a sobering picture of a generation confronting the gap between what they planned and what retirement has actually cost.

Rising Costs Are Adding to Financial Stress

A significant part of the pressure retirees are feeling comes from expenses that have grown faster than anticipated, particularly in healthcare and everyday essentials.

Kevin Jestice, president of Nationwide Retirement Solutions, said the rising costs for essentials and healthcare have increased both uncertainty and stress among retirees, forcing many to be more conservative with spending than they had planned before leaving the workforce.

When asked what advice they would give their younger selves, retirees in the study offered a consistent message: assume you will need more money than you think, do not assume you can work as long as you intend to, and avoid living beyond your means before retirement.

Most Retirees Depend Heavily on Their Savings

Only one in five retirees has been able to avoid drawing on retirement savings by relying exclusively on guaranteed income from a pension or Social Security.

That means the overwhelming majority are leaning on investment accounts and savings to cover living expenses, which introduces volatility and uncertainty into their day-to-day financial lives.

This dependence has made many retirees increasingly vigilant about their portfolios. More than half of recent retirees are reviewing their retirement plans and investment accounts monthly, while nearly one in five is checking their investments daily.

The increased attention is also translating into action. Half of recent retirees made portfolio changes in response to market turbulence, compared to just one-third of those who have been retired for longer periods.

Early Retirement Decisions Carry Long-Term Consequences

Financial advisers stress that the first few years of retirement are among the most consequential in determining how long savings will last.

Jestice said poor investment returns in the early years of retirement can dramatically reduce the longevity of a portfolio, which is why asset allocation, withdrawal strategies, and maintaining cash reserves are especially critical in that initial period.

He also warned that overspending early in retirement on travel or home improvement projects can create long-term sustainability problems, while allowing small health issues to go unaddressed can lead to much larger and more expensive challenges down the road.

A Real-World Example of Navigating Early Retirement

Jeanne Thompson, a senior retirement consultant with LPL Financial who accepted an early retirement package four years ago at age 58, described the adjustment as a rude awakening.

The S&P 500 dropped more than 19% in her first year of retirement, a development that tested her confidence in her financial plan. However, Thompson said she had deliberately kept a few years worth of expenses in cash reserves and had committed to sticking with her plan regardless of short-term volatility.

“After I retired, very quickly the honeymoon wore off,” Thompson said. “That was a little scary. But I had kept a few years in cash reserves, I had my plan, and I knew if I stuck to it, it would be OK. And it was.”

Her experience underscores a point that financial planners frequently make: having a buffer against early market downturns is one of the most effective tools for protecting long-term retirement security.

The Advice Most Retirees Wish They Had Followed

The research from Nationwide reflects a pattern that financial advisers say they see consistently. Many people underestimate how much they will need in retirement, overestimate how long they will be able to continue working, and underestimate how quickly expenses can escalate once they leave the workforce.

Jestice encouraged retirees to also budget deliberately for enjoyment, noting that identifying how much “fun money” is available within a sustainable plan is an important part of a healthy retirement rather than an afterthought.

The broader lesson from the data is straightforward: the earlier saving begins, the more flexibility retirees will have when it matters most.