Conventional wisdom assumes all retirees spend their assets the same way through retirement. But different retirees have different spending and saving preferences. Our research discovered that while some retirees draw down their account balance, many others choose to maintain, or even grow, their balance throughout retirement. Learn how this information can be used to better plan for retirement.
Not all retirees draw down their assets in retirement
Source: T. Rowe Price Retirement Savings and Spending Study (2021), Question 83, Tables 232-1 and 233-1.
Spending through retirement does rise, but slowly
Real spending (adjusted for inflation)
Source: Banerjee, Sudipto, Decoding Retiree Spending, T. Rowe Price Insights on Retirement, T. Rowe Price Group, Inc., March 2021 analysis of Health and Retirement Study, public use dataset. Produced and distributed by the University of Michigan with funding from the National Institute on Aging (grant number NIA U01AG009740). Ann Arbor, MI.
Retirement spending differs based on household net worth
What drives Savers to preserve assets instead of spend?
This material is provided for informational purposes only, and is not intended to provide legal, tax or investment advice. This material does not provide recommendations concerning investments, investment strategies or account types, advice of any kind; and not intended to suggest any particular investment action is appropriate for you. Please consider your own circumstances before making an investment decision.
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