A widening gap between saving and spending is creating a fresh challenge for advisors, as new research shows most working Americans expect to hold back financially once they stop earning a paycheck, even when their accounts are healthy enough to support a comfortable retirement.
The 2026 annual Retirement Study from the Allianz Center for the Future of Retirement, part of Allianz Life Insurance Company of North America, found that 71% of working Americans expect to be reluctant to draw down their savings once retired, largely out of a desire to protect their balances.
That instinct doesn't fade once retirement actually begins: 39% of current retirees say they still hesitate to spend for the same reason.
Four risks dominate the reasoning behind that reluctance, each cited by roughly half of respondents: outliving their money, facing steep medical or long-term care bills later on, getting hit with unplanned costs like a major home repair, and watching inflation erode what their savings can buy (50%, 50%, 50% and 48% respectively).
Kelly LaVigne, VP of consumer insights at Allianz Life, said the discomfort is rooted in decades of habit.
"People spend most of their lives building their savings and it can feel uncomfortable or even wrong to spend that money," LaVigne said. "A written financial strategy can help you understand how much you can comfortably spend and find confidence to spend your money and enjoy your retirement."
Roughly a third of retirees, 32%, said it felt wrong to begin drawing down assets after spending decades building them up, pointing to a psychological hurdle that a purely numbers-based plan may not solve on its own.
The data also points to a mismatch between what workers brace for and what retirees actually experience. Most working Americans, 60%, expect their retirement spending to fall below three-quarters of their pre-retirement level.
However, 55% of retirees report spending at least three quarters of what they spent while working, suggesting advisors may need to recalibrate client expectations well before the transition happens.
Some 42% of respondents fear they'll look back and wish they had spent less early in retirement, while a smaller but still significant 35% worry about the opposite: not having spent enough.
"It's not just how much you spend, it's about what you spend it on," LaVigne said. "When your spending aligns with what matters most to you, whether that is philanthropy or travel, you can feel more confident using your savings without fear of regret."
Uncertainty over future costs compounds the problem. Three-quarters of those surveyed, 75%, said predicting how much they'll actually need in retirement is very difficult given how expenses shift over time.
"Many Americans may be financially prepared for retirement, but not psychologically prepared to spend," LaVigne said. "That's why retirement strategies need to evolve beyond building assets to managing how assets are used and addressing risks throughout retirement."
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