Spending Trajectories After Age 65

Author(s): Susann Rohwedder, Michael D. Hurd


  • Retirement Spending

Year Published: 2022

My Rating: TBD

One Sentence Summary: Retirees spend less, on an after-inflation basis, as they age, regardless of income.


Key findings from the report:

  • Real spending—that is, spending adjusted for inflation—declined for both single and
    coupled households after age 65 at annual rates of about 1.7 percent and 2.4 percent,
  • Real spending declined for all initial wealth quartiles, although with some modest
  • The fact that spending declines broadly, including among those in the highest wealth
    quartile, suggests that the decline may not be related to economic position. (See Figure
  • The view is supported by an analysis of budget shares, the fraction of total spending
    devoted to subcategories of spending.
  • The budget share for gifts and donations increases with age, which suggests that
    economic position on average does not deteriorate with age, even as spending declines.

Charts & Graphs

The Newsletter

If you enjoyed this article, consider joining a community of over 20,000 people who receive my free retirement newsletter every Sunday morning.

You can also check out a recent newsletter here.