The pandemic is prompting people to review their retirement plans and many are realizing they forgot something important: taxes, said Nationwide Retirement Institute.

A majority of Americans (59%) are more worried about paying taxes in retirement than they were before Covid-19 struck, and 63% said it is now more important than ever to develop a financial plan that includes a tax strategy, Nationwide said.

Nationwide based its conclusions on two studies, the Covid-19 Tax Survey and the Covid-19 Financial Survey, both of which were done in April and included more than 2,000 people.

Although the world is only months into the pandemic crisis, 38% of Americans already are saying Covid-19 has affected their retirement plans by forcing them to retire later than expected, making them not being able to retire at all, or forcing them into early retirement by losing a job or having other financial hardships, the surveys said.

Even before the pandemic, 35% of Americans did not consider how taxes would affect their retirement plans, Nationwide said. The current crisis is an opportunity for financial professionals to discuss tax planning in retirement and to educate clients on the best strategies to reduce unexpected taxes on combined income sources.

“The need for this guidance from financial professionals is significant. Twenty percent of current and future retirees do not get tax planning advice from any source, underscoring an important opportunity for financial professionals to work with clients,” Nationwide said.

“Further, 42% of future retirees would switch financial professionals for someone who could help them plan for their taxes in retirement. A financial professional can ask smart questions, help consumers effectively and holistically prepare for the future, and determine how to correctly use income sources to maximize retirement income and minimize taxes,” Nationwide said.

Eric Henderson, president of Nationwide’s Annuity business, said in an interview with Financial Advisor magazine that he was surprised by the number of people not considering taxes in their retirement plans.

“While being in retirement can reduce or eliminate several expenses in older adults’ budgets, their tax bill may not be one of them,” Henderson said. “The data clearly illustrates that retirees aren’t always strategically preparing for, or even thinking about, taxes in retirement, and as a result, may be paying thousands of dollars more than needed.”

Only 43% of respondents said they know how to leverage taxable, tax-deferred and tax-free accounts, the surveys said. “Building tax flexibility into a retirement income plan is crucial. Doing so allows older adults to use a variety of investment and retirement accounts, including taxable, tax-deferred and tax-free accounts, to potentially avoid higher tax brackets and effectively manage their incomes,” according to Nationwide.

The surveys also showed that 24% of Americans said they plan to go to a professional financial advisors for assistance for the first time. The surveys said financial professionals top the list of trusted sources for general financial and money management advice during the pandemic.

“I hope they follow through,” said Henderson. “An advisor can help them take the long view” and make contingency plans “in case things do not turn out the way we think they will. While we are all adjusting to our new environment, it’s difficult to gauge what could happen in the future, such as where the stock market is headed or what the impact of inflation will be in ten years.

“Therefore, consumers should focus on what they can control: building a strong financial plan that accounts for the unexpected, as well as optimizes tax strategies. By taking the right steps to plan for taxes in retirement, retirees can help offset potentially negative impacts to their retirement income,” he said.

The surveys showed 39% of people said they are likely to take money from their 401(k) or IRA because of the pandemic, which is a situation Henderson described as “scary.” Millennials are more likely to look to their retirement funds for immediate relief than other age groups.