Worried About Running Out of Money? Here Are 4 Reasons Why Retirees Need To Laser In On Their Spending
Over a decade of helping dozens of retirees, one of the most common fears I hear from retirees and pre-retirees is simple, yet powerful:
“Will I run out of money?”
This concern shows up regardless of net worth. I’ve seen households with significant savings lose sleep over retirement, while others with far less feel surprisingly calm. The difference is rarely investment returns alone. It’s confidence in what sustainable spending looks like for who I'm sitting across from.
Retirement success isn’t just about how much you’ve saved. It’s about how well your lifestyle aligns with what your money can realistically support. Here are four reasons why focusing on spending is one of the most important parts of retirement planning.
1. Knowing What Lifestyle You Can Afford Matters More Than Anything Else
At its core, retirement planning is a lifestyle planning exercise.
You’re no longer earning a paycheck, which means your savings and income sources must support your spending for decades. Without clearly understanding what your lifestyle costs, even a well-funded portfolio can feel fragile.
When retirees truly know:
- Their normal living expenses
- Their discretionary “fun” spending
- How those expenses may change over time
They gain something invaluable: control.
It’s much easier to make confident decisions about travel, gifting, helping family, or major purchases when you know exactly how those choices fit into the bigger picture. Retirement confidence doesn’t come from hoping the numbers work, it comes from knowing they do.
2. The People Who Worry Most About Outliving Their Money Often Live Lives They Can’t Afford
This is blunt but it's reality.
The retirees who are most anxious about money are often spending at a level their assets and income can’t sustainably support. Sometimes this happens unintentionally — lifestyle creep, rising costs, or maintaining a pre-retirement standard of living without realizing how the math changes.
You can't outgrow poor spending habits.
When spending exceeds what a plan can reasonably support:
- Every market downturn feels catastrophic
- Every unexpected expense creates stress
- Every financial decision feels risky
No amount of investment performance can fully offset a lifestyle that isn’t aligned with reality. The worry isn’t irrational. It’s your mind recognizing a mismatch between spending and sustainability.
3. The Most Comfortable Retirees Live Well Within Their Means
On the flip side, the retirees who feel the most at ease aren’t necessarily the wealthiest, they’re the most intentional.
They:
- Spend less than their plan allows
- Build margin into their lifestyle
- Treat excess savings as a buffer, not an invitation to overspend
This margin creates flexibility. Markets can fluctuate. Expenses can surprise you. Life can change. When spending is comfortably below what your plan supports, those events feel manageable instead of threatening.
Living within your means in retirement isn’t about deprivation. It’s about freedom. Freedom from constant financial stress and freedom to enjoy what matters most without second-guessing every decision.
4. Financial Happiness and Comfort Is in Your Mind
Much of retirement anxiety comes from uncertainty, not numbers.
When spending is unclear, your brain fills the gap with worst-case scenarios:
- What if inflation spikes?
- What if healthcare costs explode?
- What if the market has a bad decade?
By turning unknowns into knowns, you calm the mental side of retirement.
A well-designed retirement plan doesn’t just show that the money might last. It shows why, how, and under what conditions it lasts. That understanding is what allows retirees to actually enjoy the retirement they worked so hard to build.
Final Thoughts
If you’re worried about running out of money in retirement, the solution often isn’t chasing higher returns or taking more risk. It’s gaining confidence around your spending and marrying your lifestyle with what your resources can truly support.
When spending is intentional, realistic, and well-understood, retirement becomes less about fear and more about confidence, comfort, and peace of mind.
If you’d like help stress-testing your retirement spending or building a clearer picture of what your lifestyle can afford, I'm always happy to start that conversation.
Anthony Sandomierski
CPA/PFS, CFP®, MS (Taxation)
Wealth Advisor
