Older Americans are afraid to spend their riches in retirement

• Many retirees fear spending savings, with most prefering leaving a surplus over depleting funds.
• A Prudential survey shows retirees struggle with balancing spending on enjoyment and future saving.
• Retirees feel guilty spending on luxuries and prefer guaranteed monthly income over a lump sum.

Millions of Americans save for decades for the day when they turn in their laptops and never have to work again. When the day comes, though, many fear spending down their nest eggs.

Prudential Financial's 2026 Retirement Pulse survey, conducted online between July and August, found that only 14% of respondents felt comfortable spending each month in retirement for enjoyment, such as hobbies, travel, and dining out. Anxiety about spending doesn't go away among higher-net-worth individuals, as 39% of those with over $500,000 in investable assets felt comfortable spending for enjoyment.

As Prudential notes, it's a case of FORO, or Fear of Running Out. Over half said they would rather leave behind too much than risk exhausting what they have, or preserve what they have without decreasing their assets. That number rose to 70% for those with over $500,000. The survey drew from over 3,000 American adults age 50 and older.

A common assumption about retirement planning is that "savings looks like a mountain where you climb this mountain, then you save this wealth, then you spend it down," said David Blanchette, head of retirement research for Prudential Financial. "In reality, it's not a mountain for most people. It's a plateau."

Prudential found that 42% of survey respondents said they've been unable to find a balance between living in the moment and waiting for life to progress before enjoying it. Many older Americans whom Business Insider spoke with over the last two years agreed. A few said they made painful sacrifices earlier in life, such as skipping family vacations, in hopes of retiring at 65, then were diagnosed with cancer or chronic pain.

"I did well saving for retirement, but so much so I was too frugal along the way and did not enjoy as much while younger as I worked too much," Ruth Mills, now 64, told Business Insider in late 2024.

Nearly half of the respondents said they hesitated on spending because of doubts about whether Social Security would still be available down the line. Over two in five said inflation and the rising cost of living have made them more cautious, while a third cited long-term care costs. Most also wanted to live longer than they expected, leading many to save as though they would live to 100, though that was unlikely.

Scott Scovel had saved $3 million for retirement, but instead of retiring at 58, he kept working out of fear of hyperinflation. He had been consistent in saving throughout his life, deferring life's joys to take advantage of his earnings later. However, he hadn't mentally prepared to retire and dig into his savings.

"For decades, I'd heard retirement advice encouraging me to 'save more!' But no one explained that at some point, I'd need to radically shift my lifestyle and 'spend more!'" he previously told Business Insider.

The survey found that nearly two-thirds of respondents experienced guilt when spending on entertainment and adventures, rising to 86% for higher-cost purchases such as a beach house or a sports car. About two-thirds said it was difficult to justify hiring people to ease the burden of tasks like housekeeping or gardening.

Many older Americans have told Business Insider they felt guilty for spending money on a caregiver. Some said that as they watched their net worth decline after spending thousands of dollars each month on assisted living or home health aides, they were forced to change their mindset, eventually coming to believe that this spending was necessary for their happiness and well-being.

Some added that they returned to work, at least part-time, to supplement their Social Security and feel more secure. Workers with mid-six-figure savings said they were worried they would live to 100 and eat through everything they had accrued up to that point. As the survey noted, 44% of those with over $500,000 in investable assets didn't know how long their money would need to last.

Almost half of the respondents knew they could cover their essential living expenses for life, which provided some relief. However, anxiety was more apparent among pre-retirees, especially given that less than a quarter had a clear retirement plan.

Prudential's experts said that the survey should contribute to the discussion on a guaranteed monthly income, whether in the form of an annuity or another instrument, as two-thirds of respondents said they'd prefer a guaranteed monthly check over a lump sum. While AI has been helpful for some older Americans for retirement guidance, nearly all said they would rather consult a human before making any financial decisions.

"A lot of times, that guaranteed income lets them know that they can have income forever, and that extra money they can do some of the nice vacations, redecorate the house, do whatever they feel is important," said Barbara Pietrangelo, a financial planner with Prudential Wealth Advisors.

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