Will I Run Out of Money in Retirement? Here’s the Real Answer
It’s the question that keeps most future retirees up at night—what if I outlive my money? In fact, 64% of adults fear running out of money more than death itself. Among Gen Xers, that fear jumps to 70%. But here’s the thing: while the fear is real, the outcome is often far more manageable than we’re led to believe.
Are Retirees Actually Running Out of Money?
You may have heard that 45% of Americans retiring at 65 will run out of money. That stat gets thrown around a lot, but it’s based on outdated models that assume retirees spend the same amount every year, regardless of what’s happening in their life or the markets. In reality, retirees adjust. Many cut back even when they don’t have to. Wealthy retirees hold back too—worried about unexpected healthcare costs or market volatility. The truth is, most people adapt instead of blindly depleting their nest egg.
Spending in Retirement Isn’t Linear
Research from David Blanchett and T. Rowe Price shows spending in retirement tends to decline by about 1% to 2% per year. Yes, healthcare costs may rise, but other expenses like commuting, housing, and entertainment often go down. Some retirees follow a “retirement smile” spending pattern—more in the early years, less in the middle, then a modest rise later for medical costs. This natural decline in spending means your portfolio doesn’t need to be as large as you think. If you plan to spend $60,000 a year, you might only need $835,000—not $1.5 million.
Why Dynamic Spending Strategies Work
Instead of a rigid withdrawal plan, many retirees use dynamic spending strategies. That means adjusting withdrawals based on market performance and personal needs. Set guardrails. Adjust annually. Doing so boosts the odds your money lasts for life. It’s flexible, responsive, and realistic—because life is rarely linear.
Retirees Make Real-World Adjustments
About one-third of retirees in their 60s consider part-time work or consulting to supplement their income. Others downsize or move to lower-cost areas. Some rely on family temporarily. Retirees don’t just let their accounts run dry—they respond, adapt, and take control. That’s what real retirement looks like.
Retirement Confidence Is Higher Than You Think
According to the 2025 Retirement Confidence Survey, 78% of retirees say they feel confident about having enough to live comfortably. That’s even higher than the 67% of pre-retirees who feel the same. Confidence actually grows once you retire. Why? Because you realize life doesn’t stop, and the sky doesn’t fall.
Don’t Believe the Headlines
Alarming headlines claiming half of retirees will run out of money ignore how people actually behave. These models don’t consider flexibility, Social Security, pensions, or retirees picking up part-time work. They don’t factor in that people tend to spend less over time. It’s not that retirees are perfect—it’s that they’re practical. And they do what it takes to make it work.
Planning for a Confident Retirement
You don’t have to retire scared. With proper planning, flexible strategies, and a willingness to adjust, retirement can be more secure than you imagined. Don’t base your future on fear. Build it on facts—and give yourself the grace to adapt as life evolves.
Retirement isn’t about knowing exactly what will happen. It’s about being ready no matter what does.
All writings are for educational and entertainment purposes only and does not provide investment or financial advice of any kind.
