Retiree's - live a little why don't you. From the Financial Planning Association, Journal of Financial Planning.
https://www.onefpa.org/journal/Pages/FEB16-Spending-in-Retirement-Determining-the-Consumption-Gap.aspxExecutive Summary
Retirement savings adequacy estimations are often based on the assumption that clients spend the same amount every year in retirement, and that the withdrawal rate to fund spending is based on spending down a percentage of retirement savings.
The purpose of this study was to determine if, despite the possibility of low asset returns and longer lives in retirement, retirees are spending an amount that would put them in danger of running out of money.
We simulated safe consumption rates and compared the amount that wealthy retirees are spending to the amount they could safely spend given different asset return assumptions and investment portfolio allocations.
We followed the change in assets among retirees during the 2000s to see how much of their wealth they spent down during this period.
Retirees in the top quintile of financial wealth were spending nowhere near an amount that would place them in danger of running out of money. In fact, the average financial assets of wealthy retirees increased during this period and most retirees spent less than their income.
Setting aside 40 percent of financial assets to cover uncertain longevity, medical costs, and bequests still results in a consumption gap as high as 47.3 percent among higher-wealth retirees.
