Do Retirees Draw Down Their Wealth – and If Not, Why Not?

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Robert L. Siliciano and Gal Wettstein, Boston College

Past generations drew down their wealth slowly in retirement, leaving much of their savings untouched. However, this pattern may not hold as the Baby Boomer generation retires, because they are less likely to have a defined benefit (DB) plan and will need to tap the assets in their defined contribution plans to support their consumption. This paper uses data from the Health and Retirement Study to estimate the relationship between access to DB plans and the speed at which past generations drew down their wealth.