The Truth About Spending in Retirement and Why It’s Good News

Research by David Blanchett from Prudential Financial challenges the common assumption that retirees need income to increase with inflation each year. Data shows most retirees actually reduce spending as they age, which could allow for higher initial withdrawal rates (5-5.5%) compared to the traditional 4% rule. Healthcare remains a significant wildcard expense, but overall retirees report higher life satisfaction despite lower spending.