Summary
The third Spending in Retirement study, fielded during the summer of 2024, surveyed approximately 3,600 American retirees between the ages of 62 and 75 to assess how their spending patterns and retirement well-being have changed since their retirement.
Some of the key findings include:
- Among the 58 percent who retired earlier than expected, the most common reasons for retiring were having a health problem or disability (38 percent) and changes at their company, such as downsizing, closure, or reorganization (23 percent).
- The prevalence of outstanding credit card debt increased substantially compared with 2022 and 2020. In 2024, 68 percent of retirees reported having outstanding credit card debt, compared with 40 percent in 2022 and 43 percent in 2020.
- Individual retirement accounts (IRAs) were noted as being a current income source for 20 percent of retirees, while 401(k)-like workplace retirement plans were an income source for 17 percent of retirees. The median share of income generated by these accounts was 10 percent for IRAs and 15 percent for 401(k)-like accounts.
- Continuing the shift observed in 2022, more retirees (31 percent) said their spending is much higher or a little higher than they can afford in 2024 (up from 27 percent in 2022 and 17 percent in 2020).
- Given their economic circumstances during retirement, half of the retirees said they saved less than what was needed for retirement. One in three said they saved the right amount, and 17 percent said they saved more than what was needed.
- Retirees were asked to rate their consumption philosophy on a scale of 1–10, where 1 is "I have a savings mindset" and 10 is "I have a spending mindset." While half (51 percent) were relatively neutral, rating themselves as a 4, 5, 6, or 7, about 38 percent said they have a “savings mindset” with a rating of 1, 2, or 3. On the other end of the spectrum, just 11 percent said they had a “spending mindset” with a self-reported rating of 8, 9, or 10.
- Overall, 59 percent of retirees said they have three months of emergency savings, down from 69 percent in 2022. Yet, one in three (36 percent) retirees have experienced unexpected spending needs since their retirement.
- In 2024, retirees rated two out of three well-being measures lower than they did in 2020 and 2022. On a scale of 1–10, where 1 is “not at all aligned,” and 10 is “very aligned,” retirees rated lifestyle alignment with preretirement expectations an average of 5.7, down slightly from 6.4 in 2022 and 6.8 in 2020. Similarly, retirees rated their satisfaction with life in retirement an average of 6.9 in 2024, down slightly from 7.0 in 2022 and 7.4 in 2020.
EBRI was able to fund the development of this research thanks to generous support from EBRI’s Retirement Security Research Center partners: American Funds/Capital Group, Empower, Mercer, Principal Financial Group, Transamerica Retirement Services, BlackRock, J.P. Morgan, PGIM, and SS&C Technologies.