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59% of survey respondents wish they had better prepared for taxes in retirement, and 51% of retirees say they did not consider tax rates when originally planning their retirement income, revealing a widespread knowledge gap despite having saved and built portfolios.
Most Americans significantly overestimate their understanding of Social Security, with 74% feeling confident managing benefits without professional help while scoring only 8 out of 15 on a true-or-false knowledge test, creating a mismatch between confidence and preparedness that drives tax-planning regret.
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The Nationwide Retirement Institute's 2025 Social Security Survey does not bury the tax finding. It surfaces immediately, and the data behind it is consistent across every demographic group the survey examined. Six in ten respondents wish they had better prepared for paying taxes in retirement, and more than half of retirees say they did not consider how tax rates would affect their retirement income when they were originally planning. That combination, widespread regret paired with a clear gap in foresight, is what a planning crisis looks like before it becomes a financial one.
What makes the finding harder to dismiss is that it does not describe people who failed to plan at all. These are households that saved, claimed Social Security, and built portfolios. The piece they missed is the one that arrives quietly every year after they stop working, and by the time it shows up, it is already too late to restructure.
The survey tested respondents on 15 true-or-false statements about Social Security, and the average score was 8 correct out of 15. Only 21% of respondents correctly identified their full retirement age, and 38% admitted they do not know it at all. Those numbers matter for tax planning specifically because the timing of a Social Security claim determines how much of that benefit becomes taxable income, and most respondents did not demonstrate enough foundational knowledge to make that connection.
The overconfidence problem compounds the gap. Seventy-four percent of respondents say they feel confident managing their Social Security benefits without the help of a financial professional. That level of self-assurance is difficult to square with an average test score of 8 out of 15, and it helps explain why the regret figures are as high as they are. People who believe they understand the system well enough to go it alone are the least likely to seek the guidance that would have prevented the tax surprise in the first place.
The 59% who wish they had planned better for retirement taxes are not outliers. Among retirees specifically, 51% say they did not factor tax rates into their retirement income planning at all. That is not a fringe result. It means that among people who have already made their claiming and withdrawal decisions, more than half did so without modeling what those decisions would cost them in taxes each year.
The anxiety about taxes does not stop at the retiree population. Among non-retirees, 65% say they are worried about what tax rates during retirement will do to their income. The survey also found that 58% of all respondents agree they are worried about what retirement tax rates will do to them, a figure that holds across age groups and income levels. The concern is widespread. The preparation is not.
The generational data in the survey is striking. Seventy percent of Gen Z respondents and 68% of Millennials expect their taxes to rise significantly in the next five years. More than 3 in 5 non-retirees say it is more important to minimize taxes now than in retirement. Those attitudes suggest a generation that is aware of the problem in the abstract but has not yet translated that awareness into action. Expecting taxes to rise is not the same as structuring a portfolio to manage the increase when it arrives.
The survey also found that 52% of respondents expect their taxes to rise significantly over the next five years. That concern crosses generational lines, yet the gap between expecting higher taxes and planning for them is where the same pattern of regret the current retiree generation is experiencing gets set in motion for the next one.
73% of respondents say they are interested in learning how Social Security is taxed, and 72% want to learn from a financial professional how inflation could affect their retirement income. The appetite for guidance is clearly present in the data. Also present is evidence that most people are not getting it. Fifty-four percent of all respondents say they would switch financial advisors for someone who could help them plan for taxes in retirement, and among those already paying for advice, 78% say they would switch if their advisor could not help them maximize their Social Security benefits.
Those numbers point to a market failure as much as a personal planning failure. The demand exists. The willingness to pay for better advice exists. The survey suggests the matching is not happening at anywhere near the scale the data says it should.
Eighty percent of respondents agree that the Social Security system needs to change, and only 43% believe the government will actually fix it. That gap between what people think needs to happen and what they expect to happen is the honest backdrop for every tax planning decision a retiree makes. The system was designed to supplement retirement income, not replace it, and its interaction with taxes, Medicare premiums, and other income sources makes it more complicated than most households realize until the bill arrives.
The survey's tax findings are not an indictment of retirees. They are an indictment of how little structured guidance reaches people before the decisions that matter most are already made. Six in ten wishing they had done more is not a personal failure at scale. It is a signal that the conversation about taxes in retirement needs to start earlier, go deeper, and reach more people before regret sets in.
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