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Previous research has shown that spending drops immediately at the moment the paychecks stop, and a few studies have found that households, once retired, reduce their consumption over time. But a new study that also takes the long view suggests that the spending decline is not what retirees want to do but what is necessitated…
The brief’s key findings are: State and local policymakers face a growing pension cost burden, but often lack understanding of the root causes. One underappreciated cause is “legacy debt” – unfunded liabilities accumulated long ago, before plans adopted modern funding practices. Legacy debt still exists today because historical unfunded liabilities were ultimately paid in fu…
