At a Glance | April 8, 2021 Unforeseen Costs Are the Main Reason Retirees Don’t Want to Spend Down Their Assets SPEND, SAVE, GROW Thinking about all the money you have in financial accounts, do you plan to...? Most retirees don’t want to Spend Spend a Spend a Spend spend down all their assets. Just Down Significant Portion Small Portion Down Grow All Assets of Assets of Assets No Assets Assets over 4 in 10 respondents ages 62–75 in EBRI’s Spending in 14% 29% 34% 9% 14% Retirement Survey reported that they planned to spend down all or a significant portion of their assets in retirement. WHY NOT SPEND? What are the reasons you plan to not spend down your retirement assets? Fear of running out of money 38% 37% 40% 33% is not the primary motivator. 31% 27% Over a third are just saving for a 23% rainy day; others just don’t see a 15% reason to spend. 5% 0% Saving for Spending Leave as Makes Me Afraid of Once Assets Ination Don’t Unforeseen Down Isn’t Much as Feel Better Running out Are Spent, Concerns Know Costs Necessary Possible to of Money Can’t Be Heirs Recovered WHY SPEND? Are the following reasons to spend down your assets in retirement? Retirement lifestyle and Not a reason Yes, reason to spend down discretionary spending were 28% 72% Retirement Lifestyle the most common reasons that people planned to spend down 29% 71% Discretionary Spending, e.g., their assets in retirement. Vacations, Clothes, or Jewelry 31% 69% This was followed by health Health and Medical Insurance insurance, housing repairs, and 31% 69% Housing Repairs / Renovations housing expenses. 34% 66% Housing Expenses The findings suggest that 35% 65% Medical Bills spending in retirement involves both necessity and behavioral 35% 65% Car Expenses or Repairs preferences. 40% 60% Needing Physical Support or Care to Live My Life 74% 26% Supporting Other Family Members 88% 12% Education Costs for Children or Grandchildren 88% 12% A New Home SOURCE: Lori Lucas, “Why Do People Spend the Way They Do in Retirement? Findings From EBRI’s Spending in Retirement Survey,” EBRI Issue Brief, no. 522 (January 14, 2021). © 2021 EBRI This report is copyrighted by the Employee Benefit Research Institute (EBRI). You may copy, print, or download this report solely for personal and noncommercial use, provided that all hard copies retain any and all copyright and other applicable notices contained therein, and you may cite or quote small portions of the report provided that you do so verbatim and with proper citation. Any use beyond the scope of the foregoing requires EBRI’s prior express permission. For permissions, please contact EBRI at permissions@ebri.org. fl