PLANADVISER - September/October 2020 - 11

The 5-Year 'Test'
A survey finds many retirees don't have the assets to keep up their spending
A REPORT from the Consumer Financial Protection Bureau
(CFPB), " Retirement Security and Financial Decisionmaking, "
found that nearly half of all retirees lacked the
ability to maintain the same spending level for five years
into retirement. Additionally, two-thirds of younger retirees
could not maintain the same spending level for their first
five years of retirement. The study used survey responses
from people who retired between 1992 and 2014, collected
through the Health and Retirement Study (HRS)-a nationally
representative panel survey of Americans over age 50.
The survey showed that the financial decisions people
made while still working affected their later spending levels.
For instance, 61% of homeowners without mortgage debt
could retain spending vs. 55% with mortgage debt. Other
reasons for unlevel spending included choosing a lumpsum
payout instead of a monthly annuity at retirement and
claiming Social Security at age 62.
The report analysis concludes that retirees' reductions
in spending, which, for many, are substantial, deserve to
be examined further, as they raise questions regarding
whether the reductions adversely affect retirees' quality of
life and/or essential expenses. -PA
Can Participants Maintain the Same Spending Level in Their First 5 Years of Retirement?
Can
maintain
the same
spending
level
All
51% 49%
Can't
maintain
the same
spending
level
58%
42%
Male
42%
34%
58%
Female
66%
Baby Boomer
62%
38%
Married
39%
61%
Never married
32%
68%
30%
70%
Separated/Divorced
Excellent health
Good health
54%
46%
40%
32%
30%
60%
Fair health
19%
37%
81%
College or higher
63%
White, non-Hispanic
68%
Poor health
70%
Less than high school
27%
73%
Black, non-Hispanic
Source: Consumer Financial Protection Bureau, Health and Retirement Survey
52% 48%
High school/GED
23%
77%
Hispanic
Other, non-Hispanic
59% 41%
Some college
42%
58%
planadviser.com September-October 2020 | 11

http://www.planadviser.com

PLANADVISER - September/October 2020

Table of Contents for the Digital Edition of PLANADVISER - September/October 2020

A Careful Inspection
2020 PLANADVISER Retirement Plan Adviser Survey
Keeping Clients Safe
Cures for Virtual Meeting Fatigue
Inflation Protection For DC Investors
How to Show Your Worth
Never Too Late
A Return to Rollover Advice
Whether—And How—To Vote Proxies
PLANADVISER - September/October 2020 - Cover1
PLANADVISER - September/October 2020 - Cover2
PLANADVISER - September/October 2020 - 1
PLANADVISER - September/October 2020 - 2
PLANADVISER - September/October 2020 - 3
PLANADVISER - September/October 2020 - 4
PLANADVISER - September/October 2020 - 5
PLANADVISER - September/October 2020 - 6
PLANADVISER - September/October 2020 - 7
PLANADVISER - September/October 2020 - 8
PLANADVISER - September/October 2020 - 9
PLANADVISER - September/October 2020 - 10
PLANADVISER - September/October 2020 - 11
PLANADVISER - September/October 2020 - A Careful Inspection
PLANADVISER - September/October 2020 - 13
PLANADVISER - September/October 2020 - 14
PLANADVISER - September/October 2020 - 15
PLANADVISER - September/October 2020 - 2020 PLANADVISER Retirement Plan Adviser Survey
PLANADVISER - September/October 2020 - 17
PLANADVISER - September/October 2020 - 18
PLANADVISER - September/October 2020 - 19
PLANADVISER - September/October 2020 - 20
PLANADVISER - September/October 2020 - 21
PLANADVISER - September/October 2020 - 22
PLANADVISER - September/October 2020 - 23
PLANADVISER - September/October 2020 - 24
PLANADVISER - September/October 2020 - 25
PLANADVISER - September/October 2020 - Keeping Clients Safe
PLANADVISER - September/October 2020 - 27
PLANADVISER - September/October 2020 - 28
PLANADVISER - September/October 2020 - 29
PLANADVISER - September/October 2020 - Cures for Virtual Meeting Fatigue
PLANADVISER - September/October 2020 - 31
PLANADVISER - September/October 2020 - 32
PLANADVISER - September/October 2020 - 33
PLANADVISER - September/October 2020 - Inflation Protection For DC Investors
PLANADVISER - September/October 2020 - 35
PLANADVISER - September/October 2020 - How to Show Your Worth
PLANADVISER - September/October 2020 - 37
PLANADVISER - September/October 2020 - Never Too Late
PLANADVISER - September/October 2020 - 39
PLANADVISER - September/October 2020 - 40
PLANADVISER - September/October 2020 - 41
PLANADVISER - September/October 2020 - A Return to Rollover Advice
PLANADVISER - September/October 2020 - Whether—And How—To Vote Proxies
PLANADVISER - September/October 2020 - 44
PLANADVISER - September/October 2020 - Cover3
PLANADVISER - September/October 2020 - Cover4
https://www.planadviserdigital.com/planadviser/winter_2023
https://www.planadviserdigital.com/planadviser/fall_2023
https://www.planadviserdigital.com/planadviser/summer_2023
https://www.planadviserdigital.com/planadviser/industryleader_2023
https://www.planadviserdigital.com/planadviser/spring_2023
https://www.planadviserdigital.com/planadviser/november_december_2022
https://www.planadviserdigital.com/planadviser/september_october_2022
https://www.planadviserdigital.com/planadviser/july_august_2022
https://www.planadviserdigital.com/planadviser/may_june_2022
https://www.planadviserdigital.com/planadviser/industry_leader_awards_2022
https://www.planadviserdigital.com/planadviser/march_april_2022
https://www.planadviserdigital.com/planadviser/january_february_2022
https://www.planadviserdigital.com/planadviser/november_december_2021
https://www.planadviserdigital.com/planadviser/september_october_2021
https://www.planadviserdigital.com/planadviser/july_august_2021
https://www.planadviserdigital.com/planadviser/may_june_2021
https://www.planadviserdigital.com/planadviser/march_april_2021
https://www.planadviserdigital.com/planadviser/january_february_2021
https://www.planadviserdigital.com/planadviser/november_december_2020
https://www.planadviserdigital.com/planadviser/september_october_2020
https://www.planadviserdigital.com/planadviser/july_august_2020
https://www.planadviserdigital.com/planadviser/may_june_2020
https://www.planadviserdigital.com/planadviser/march_april_2020
https://www.planadviserdigital.com/planadviser/january_february_2020
https://www.planadviserdigital.com/planadviser/november_december_2019
https://www.planadviserdigital.com/planadviser/september_october_2019
https://www.planadviserdigital.com/planadviser/july_august_2019
https://www.planadviserdigital.com/planadviser/may_june_2019
https://www.planadviserdigital.com/planadviser/march_april_2019
https://www.planadviserdigital.com/planadviser/january_february_2019
https://www.planadviserdigital.com/planadviser/november_december_2018
https://www.planadviserdigital.com/planadviser/september_october_2018
https://www.planadviserdigital.com/planadviser/july_august_2018
https://www.planadviserdigital.com/planadviser/may_june_2018
https://www.planadviserdigital.com/planadviser/march_april_2018
https://www.planadviserdigital.com/planadviser/january_february_2018
https://www.planadviserdigital.com/planadviser/november_december_2017
https://www.planadviserdigital.com/planadviser/september_october_2017
https://www.planadviserdigital.com/planadviser/july_august_2017
https://www.nxtbookmedia.com