Do Retirees Want to Consume More, Less, or the Same as They Age?

The brief’s key findings are:

• The conventional view is that retirees prefer steady consumption as they age, but research focusing on new retirees tends to show a sharp drop right at retirement.
• This study looks at consumption over longer periods and explores whether wealth and health constraints might cause retirees to consume less than they prefer.
• The findings confirm that, for households as a whole, consumption does decline.
• However, these declines are at least partly driven by constraints, because households that are wealthier and healthier have relatively flat consumption.