Beyond the nest egg: The psychology of spending in retirement

Retirement spending is as much a psychological transition as a financial one, and many clients need help moving from accumulation to decumulation with confidence.

The biggest opportunity for advisors is to reframe spending around purpose, income, and life goals rather than account balances, which can reduce anxiety and support more intentional choices. At the same time, housing, food, and health care remain central risks that can strain retirement security if they are not planned for carefully.

Behavioral biases like loss aversion, anchoring, and mental accounting often lead retirees to underspend or feel uneasy even when their plans are sound. Advisors who use clear guardrails, income-based planning tools, and open-ended questions about lifestyle priorities can help clients feel more secure and engaged in the process.