For decades, American workers are conditioned to focus on a single financial goal: saving as much as possible for retirement. They are encouraged to build a substantial nest egg that remains largely untouched throughout their careers. However, when the time comes to actually use those funds, many retirees find the transition from the accumulation phase to the distribution phase remarkably difficult.
According to the 2026 Annual Retirement Study released in July by the Allianz Center for the Future of Retirement, 39% of retirees express a clear reluctance to spend their retirement savings. This hesitancy is also common among those still working, as 71% of working-age Americans anticipate that they will struggle to spend their funds once they reach retirement age.
Financial advisers frequently cite helping clients overcome this mental block as one of the most challenging aspects of their profession. Melissa Cox, a certified financial planner based in Dallas, notes that about half of her clients face difficulty spending their savings. "It’s hard to get somebody to even go out and spend five dollars for a cup of coffee at 7-Eleven when they’re so used to saving everything," Cox said. She described one instance where she has been "literally begging" a client to spend money on a vacation he desperately needs.
The shift in mindset is profound. During their working years, individuals manage financial shocks or large purchases by increasing their income through raises or better jobs. In retirement, income is typically fixed, leaving spending as the primary variable under a retiree's control. Jonathan Swanburg, a certified financial planner in Houston, explains that while people are accustomed to spending their paychecks, they are not used to tapping into their savings. "If you watch your portfolio go down, it can be a very stressful thing," he said.
Gerry Elam, a 68-year-old from Opelika, Alabama, experienced this firsthand after retiring early from General Electric in 2020. Despite his financial planner confirming he had more than enough money to sustain his retirement, Elam found it difficult to change his habits. "I think the biggest change for me is going from saver to spender," Elam said, adding that he tends to over-analyze any purchase exceeding a few hundred dollars.
Peter Lazaroff, a certified financial planner in St. Louis, suggests that the best savers often become the worst spenders. He explains that individuals who successfully build large portfolios are, by nature, good savers who find it painful to watch their money leave their accounts. This often leads to a conflict between two risks: the fear of running out of money, which many Americans rank as a higher concern than death itself, and the risk of living with regret by failing to enjoy their retirement.
Kelly LaVigne, vice president of consumer insights at Allianz, acknowledges that while the fear of depleting savings is valid, it can lead to missed life experiences. "I get it that you don’t want to run out of money," LaVigne said. "But you also don’t want to put off things that are really worth it to you." As Lazaroff warns, if retirees focus exclusively on the risk of running out of money, they may end up dying with regret, having avoided fulfilling bucket-list items like expensive vacations or luxury travel that they could have otherwise afforded.
