Why Playing It Safe in Retirement Can Backfire - Investing Insights | Lyssna här

Will you give yourself permission to fully enjoy your nest egg? Many retirees spent years saving to enjoy this chapter of their lives, but when they finally get there, a lot of them hold back. Of course, lavish spending can be a problem in retirees' golden years. But so can not spending enough! New Morningstar research has found retirees often withdraw their money very conservatively, even when they're not especially afraid of running out of money. As a result, they might deny themselves a dream vacation or trying new hobbies. So, what's behind it, and how can you learn to spend more in retirement and still live within your means? One of the researchers is Dr. Danielle Labotka, who's a behavioral scientist for Morningstar.

Is Your Cautious Retirement Spending Doing More Harm Than Good?

On this episode:

00:00:00 Welcome

00:01:02 Why Morningstar researchers studied retirement underspending

00:02:28 How retirees decide how much to spend

00:03:23 Why simple withdrawal strategies generally lead to underspending

00:04:42 What typically happens to retirees' wealth over time

00:05:27 Why cautious spending persists even when retirees can afford more

00:07:37 Three ways to tell if you're underspending in retirement

Watch more from Morningstar:

Why Do Active Funds Lag Even With Winning Picks?

Target-Date Funds With Annuities Are Gaining Ground. Is That Good for Your Retirement Plan?