Retirees Keep 100% of Savings Into Their Mid-80s as Fear of Overspending Curbs Spending
Updated
Updated · CNBC · Jun 8
Retirees Keep 100% of Savings Into Their Mid-80s as Fear of Overspending Curbs Spending
3 articles · Updated · CNBC · Jun 8
Summary
About a third of retirees still had 100% or more of their initial retirement savings by their mid-80s, EBRI found, highlighting how often people spend too little rather than too much.
That caution is driven by fear of running out of money and by the difficulty of shifting from decades of saving to drawing assets down, even after years of strong post-2008 market returns helped preserve wealth.
Financial advisers say the cost of underspending is missed experiences—vacations not taken, family support not given, and a less fulfilling retirement, especially in the earlier, more active years.
The same data also shows the opposite risk: about a fifth of retirees who started with more than $500,000 had less than 20% of assets left by their mid-80s.
Advisers point retirees to flexible withdrawal plans rather than rigid rules alone, using the 4% rule as a starting point and adjusting spending with markets, health needs and occasional work income.