The switch from earning a paycheck to living off savings can come with a harsh reality check.

More than half of people who retired in the past five years already regret not saving enough, and nearly 3 in 10 wish they’d started saving earlier, according to research from the Nationwide Retirement Institute.

As the expression goes, hindsight is 20/20.

“The rising costs for essentials and healthcare have increased uncertainty and stress among retirees,” Kevin Jestice, president of Nationwide Retirement Solutions, told Yahoo Finance. “And they’ve had to be more conservative with spending compared to their pre-retirement expectations.”

When retirees were asked what advice they would give their younger selves, the answer was: “Assume you will need more money than you think, don’t assume you can work as long as you’d like, and don’t live beyond your means prior to retirement.”

Only 1 in 5 have been able to refrain from tapping retirement savings by relying exclusively on the guaranteed income of a pension and/or Social Security.

Translation: The vast majority rely on their retirement savings to keep them afloat. And that’s making them antsy.

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Instead of a “set it and forget it” approach, more than half of recent retirees are reviewing their retirement plans and portfolios monthly. Nearly 1 in 5 retirees are scrutinizing their investments daily.

And they’re making moves: Half of recent retirees made portfolio changes due to market turbulence, compared to just one-third of longer-term retirees.

These actions have repercussions.

“The first few years of retirement are especially critical because financial decisions, experiences, and market conditions early on tend to impact long-term outcomes,” Jestice said. “Poor investment returns early in retirement can dramatically reduce how long your savings last, which is why early retirement asset allocation, withdrawal strategies, and cash reserves are so important.”

Read more: 5 ways to save on taxes in retirement

Case in point: Four years ago, Jeanne Thompson, 58, a senior retirement consultant with LPL Financial, accepted an early retirement package from her former employer.

“After I retired, very quickly the honeymoon wore off,” Thompson told Yahoo Finance. “The S&P 500 was down more than 19% that first year. 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.”

Additionally, bad spending choices and neglecting your health in the first few years of retirement can create a shaky path ahead.

“Early overspending on travel or home projects can create long-term sustainability issues, while small health declines ignored early can turn into major challenges later,” Jestice said.

While getting used to life without a paycheck can feel overwhelming, don’t forget to live a little right now. “Be sure to identify how much ‘fun money’ you have to work with,” he said.

Kerry Hannon is a Senior Columnist at Yahoo Finance. She is a career and retirement strategist and the author of 14 books, including "Retirement Bites: A Gen X Guide to Securing Your Financial Future," "In Control at 50+: How to Succeed in the New World of Work," and "Never Too Old to Get Rich." Follow her on Bluesky and X.

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