How to spend more in retirement without running out of money

By Kenneth Bonnici, who retired at 53 · 14 min read

Published 22 August 2026

You spent decades turning working hours into savings. Retirement is when those savings are meant to turn back into time, experiences, generosity and an easier life. Yet around a third of retirees reach their eighties with everything they saved still intact, still protecting the pile as if preserving it were the purpose.

Running out of money is a real risk. So is running out of healthy years with money you were always too afraid to use. A good retirement plan protects you from both.

The largest final balance is the wrong score

Saving is a habit with decades of reinforcement. Spending from the capital feels different. The account falls instead of rises, and a fall can feel like failure even when it is exactly what the money was built for.

This is not just anecdotal. A 2023 review in the Journal of Economic Perspectives found that retired households, particularly those with higher lifetime incomes, tend to draw down wealth slowly and that many leave large estates. The researchers identify sensible reasons: uncertainty about lifespan and medical costs, a wish to leave bequests, and reluctance to leave the family home.

The scale of it shows in the tracking data. The Employee Benefit Research Institute followed American households through the Health and Retirement Study from 1992 to 2022 and found that roughly a third still held 100% or more of their non-housing assets twenty-one to twenty-two years after retiring. Among middle-wealth households it was 43%. Median assets fell by only 30% to 43% across more than two decades of retirement.

Asked why, retirees gave EBRI five main answers. 38% were holding money back against some unforeseen cost. 37% saw no need to spend it down. 33% wanted to leave as much as possible. 31% simply felt better when the balance stayed high. 27% were afraid of running out.

Only one of those five names a destination for the money. The other four describe a feeling about the balance itself, and a feeling has no natural stopping point.

Those risks deserve a plan. But caution without a target has no natural stopping point. If every unspent pound is automatically safer than a spent one, the only winning move is to spend nothing. That protects the balance by quietly sacrificing the life it was meant to support.

A retirement plan should not ask only, “Will my money last?” It should also ask, “What is the money lasting for?”

The better score is not how rich you are on the final day of the projection. It is whether you used your resources well across all the days before it, while keeping the security and legacy you deliberately chose.

What Die With Zero gets right

Bill Perkins's Die With Zero argues for maximising “net fulfilment” rather than net worth. The title is deliberately provocative. The useful idea is not that you should gamble on the exact date of your death. It is that unused wealth should be a conscious choice, not the accidental result of lifelong saving on autopilot.

Four of the book's ideas are especially useful once retirement is possible.

Experiences have a use-by date

Money keeps. Health, energy and opportunity do not. A demanding trip, time with ageing parents, or a holiday involving grandchildren at a particular age cannot always be postponed without changing the experience or losing it altogether.

That makes timing part of value. The same amount spent at 62 and 82 may buy technically similar things, but not necessarily the same life.

Good experiences keep paying “memory dividends”

An experience can create value while you anticipate it, while you live it, and whenever you remember or share it later. Earlier experiences have more time to shape relationships and identity. That does not mean every expensive purchase is worthwhile. It means the return from meaningful spending is larger than the moment of payment.

A bucket list needs dates

Perkins recommends “time buckets”: divide the rest of life into five- or ten-year windows, then place each hoped-for experience in the window where your health, relationships and circumstances make it most possible. “Someday” then becomes a schedule.

For someone already retired, the windows can be shorter. Ask what belongs in the next two years, the following five, and later life. Put physically demanding and time-sensitive experiences first. Comfort, learning, local relationships and giving may remain valuable much longer.

Give when the help can do the most

If you mean to help family or a cause, waiting until death may deliver the money too late to have its greatest effect. Great Britain's Office for National Statistics found that inheritances were most commonly received by people aged 55 to 64, while people under 45 were the most likely to receive substantial lifetime gifts or loans. Help with education, a first home, care, or a young family may change a life more than a larger inheritance decades later.

Perkins puts the default plan more bluntly: it delivers random amounts, at a random time, to whoever happens to still be alive. Once you have seen inheritance described that way it is difficult to unsee.

Giving sooner is not automatically better. Your own security comes first, recipients may not be ready, and tax, benefits and estate rules differ by country. The point is to choose the timing rather than letting mortality choose it for you.

“Die with zero” is a direction, not a literal target

You do not know how long you will live, what care you will need, or what markets and inflation will do. A plan that reaches exactly zero at an average life expectancy is not efficient. It is fragile.

Translate the philosophy into three explicit numbers instead:

• A spending path for the life you want, with more in the years when money can do more for you.
• A cash reserve that keeps an ordinary shock from becoming a crisis or a forced sale.
• A final legacy that reflects what you truly want to preserve, including any extra late-life margin, rather than everything that happens to remain.

Die with a floor, not a fortune.

Those three numbers are the floor. Everything above it is not your safety margin; it is unspent life, and the job of the plan is to convert it into living while it is still worth the most.

ETQ is built around those choices. It projects cash and net worth one year at a time to the age you set. The exercise below uses that visibility to find spending you can permit, rather than a withdrawal percentage you must obey.

How to build a spend-more plan in ETQ

1. Save an honest base case

Open the Full Calculator, enter what you own, owe, receive and currently spend, then save it as “Base plan” in MY DATA. Include the lumpy costs people forget: home repairs, vehicle replacement, dental work, insurance, family support and tax bills not already reflected in your figures.

If you have already stopped working, set Planning Mode at the top of the input panel to Make the most of retirement. The projection then starts from today with work behind you, whether you retired before or after your state pension age. Leave your employment income as entered — retired mode stops your main employment income for you — and give each pension its real start age rather than averaging them.

That mode also changes the headline figure to Sustainable spending: the highest annual living expenses the scenario supports while keeping your cash reserve each year and your chosen legacy at the end. It depends on your figures and assumptions and is not a spending recommendation. Mortgages, dependants, asset costs, debts and other outflows stay as entered. It is the figure the rest of this guide is about, so set the two safety rails in step 5 before interpreting it.

2. Choose a deliberately long horizon

In Basics, set life expectancy as a planning horizon, not a prediction. Plan beyond the age you expect to reach. For a couple, think about the longer-lived partner and remember that some household costs remain after one person dies, even though ETQ currently models the household to one shared horizon.

The later years are what keep “spend more” from becoming “hope for the best”. If the plan only works because it ends early, it does not work.

3. Put every dependable income stream in its year

Enter state and private pensions with their actual start ages, rental income, and any part-time or post-retirement income with its start and end ages. Do not average a future pension across the whole retirement. ETQ's year-by-year view is valuable precisely because £20,000 arriving at 68 cannot pay a bill at 63.

4. Separate wealth from spendable cash

Enter cash, investments, property, debts and other assets. Then decide which assets really are available to fund life. A valuable home is not a retirement budget if you would never sell or downsize it.

Use the arrows to choose the sale order. Turn on “Never sell” to keep an asset out of automatic sales. Sales you schedule yourself still go ahead.

5. Set your two safety rails

Both of these live in Basics, under Goals, and they are the two most important fields in the tool for this exercise.

Set the Minimum cash reserve to an amount you would genuinely keep accessible. Its purpose is flexibility, not investment return. Then set the Amount you want to leave behind. Include a deliberate inheritance, protected assets and any extra end-of-plan margin you want.

Do not set a legacy merely because spending principal feels uncomfortable. Equally, do not set it to zero because a book title told you to. Write down what the number is for. If you cannot explain it, it is not yet a decision.

6. Turn your time buckets into a spending curve

List the experiences and help you want to fund, then place them into age windows. Sort them by urgency:

• Do soon: health-dependent travel, adventures, family experiences tied to children's ages, and help needed now.
• Do in the middle: slower travel, hobbies, education, home changes, ongoing family time and community.
• Keep for later: comfort, accessibility, support, local pleasures and care.

In Advanced Assumptions, use Spending changes by age to shape three broad periods. The percentages apply relative to today's annual living expenses. A plan might spend more during active years, return nearer today's level in the next period, and reduce discretionary spending later. Your health and interests decide the ages and amounts.

The research supports that shape. David Blanchett's work on how retirement spending evolves finds real spending drifting down roughly 1% a year early in retirement, and closer to 2% a year through the middle years. The familiar “spending smile”, where costs curve back up at the end, appears in the averages because a minority face very large care bills; the median retiree's curve keeps sloping down. His conclusion is the one that matters here: planning around a declining real spending path can support a starting withdrawal rate roughly 20% higher than assuming spending stays flat.

That is the arithmetic case for spending more in your active years. It is not permission to assume the decline will happen to you.

Do not mechanically cut late-life spending. Travel may fall while care, home help and health-related costs rise. If those later costs are uncertain, keep them in ordinary spending, the cash reserve, or the legacy margin rather than pretending they cannot happen.

7. Add the experiences and gifts that would otherwise stay imaginary

Use Major Future Events for large, dated expenses: a family trip, a child's deposit, a charitable gift, a renovation that lets you remain at home. ETQ has three expense-event slots, so reserve them for the largest items. Fold smaller recurring experiences into annual living expenses, or combine several plans in the same year into one clearly named event.

Then look at the timeline. If the event is absent, the intention is still outside the plan.

8. Inspect the years, not just the verdict

Switch to Projections. In Cash Flow, expand inflows and outflows around every pension start, gift, trip and asset sale. In Net Worth, check what remains and what form it takes.

Read the cash line first. Plans fail on cash, not on net worth: you can be rich on paper and still unable to pay a builder.

Your fuller plan should keep cash above the reserve every year and net worth above the chosen legacy at the horizon. Also look at the shape. A balance that grows throughout retirement despite generous assumptions may be evidence that you can use more. A line that scrapes the reserve for decades offers little room for error.

Treat the headline spending estimate as an upper limit under your assumptions, not a recommendation. Review the yearly balances to judge the margin: spending at that limit may leave little room if outcomes are worse than assumed.

9. Stress it before you trust it

Save the result as “Fuller life”, then make copies that are less kind:

• Put a market crash near the start of retirement.
• Reduce investment growth and property appreciation.
• Increase inflation and later-life spending.
• Delay or reduce income that is not guaranteed.
• Move an asset sale later, or mark an asset unsellable.

ETQ is deterministic. It shows one future for each set of assumptions, not the probability of success. Confidence comes from a range of plans that survive, not from making one line end neatly on zero.

A worked setup: from “protect it all” to “use it well”

Imagine a fictional 61-year-old retiree with current living expenses, cash, an investment portfolio, a home they intend to keep, and pensions beginning at different ages. Their first ETQ projection ends with much more than the legacy they actually want.

Instead of treating that surplus as untouchable, they build three named scenarios:

The decision does not depend on a stranger's “safe” withdrawal rate. They compare the three projections and ask:

• Does every year retain the chosen cash reserve?
• Does the stressed plan still preserve the intended legacy?
• Which plans disappear if the home is never sold?
• Is the extra final balance intentional, or simply fear expressed as money?
• Which experience becomes less valuable, or impossible, if postponed?

If the fuller plan survives sensible stresses with a large surplus, they can increase meaningful spending, give sooner, or preserve more. If it fails, they can reduce or delay the least time-sensitive item. The projection makes the trade-off visible before real money moves.

How to spend with confidence after the plan is built

A projection grants permission only if you keep it connected to reality. Review the plan at least annually, and after a major market move, bereavement, diagnosis, property decision or change in pension income.

There is a reason this matters more each year rather than less. Perkins calls it your personal interest rate: the older you are, the more someone would have to pay you to postpone an experience, because there are fewer years left in which to have it. Postponement quietly gets more expensive while the plan on paper stays the same.

• Compare actual spending with the projection. If you repeatedly spend less, decide where the unused capacity should go. Do not let it drift back into accidental accumulation.
• Protect essentials first. Housing, food, utilities, care and dependable income deserve a separate conversation from discretionary experiences.
• Bring forward what is time-sensitive. The plan can recover from a cheaper trip. It cannot recover a closed window with someone you love.
• Adjust rather than abandon. After a poor market year, postpone a flexible cost or lower discretionary spending and rerun the model. A plan should be steerable.
• Get advice where the tool stops. Tax-efficient withdrawals, pension options, lifetime income products, gifting rules, care funding and estate planning can materially change the safe path.

The goal is not to spend for the sake of spending. It is to stop withholding money from the people, experiences and years it was saved to serve.

There is no trophy for a perfectly declining chart. There is a life in progress, a family living theirs at the same time, and a finite number of healthy years in which money can still widen what is possible.

Build your fuller-life plan →

Frequently asked

Sources and further reading

• Die With Zero, Bill Perkins (opens in a new tab). The book's official site and overview of memory dividends, time buckets and net fulfilment.
• “Why Do Retired Households Draw Down Their Wealth So Slowly?”, Journal of Economic Perspectives, 2023 (opens in a new tab). A review of retirement decumulation and the roles of longevity, medical costs, housing and bequests.
• “Asset Decumulation Over Retirement and the Role of Guaranteed Income Streams”, Employee Benefit Research Institute (opens in a new tab). Health and Retirement Study data, 1992 to 2022, on how far retirees actually draw down their assets and the reasons they give for not doing so.
• “How Spending Evolves in Retirement: A Smile, a Smirk, or Something Else?”, David Blanchett, Financial Planning Review, 2026 (opens in a new tab). Evidence on the rate at which real spending declines through retirement, and what that implies for sustainable withdrawals.
• “Intergenerational transfers”, Office for National Statistics (opens in a new tab). Evidence on the ages at which people in Great Britain receive inheritances and lifetime gifts.
• How to use the ETQ Full Calculator and how ETQ's year-by-year model works.

Further ETQ reading: how do you know when you have enough to retire?, how much do you really need to retire early?, and the best money and early-retirement books, blogs and tools.

Die With Zero and Bill Perkins are not affiliated with or endorsing ETQ. This guide applies ideas from the book in original wording and adds a cautious planning framework. Educational information only, not financial advice. ETQ does not model personal tax, care needs or market probabilities and produces illustrative output sensitive to your inputs and assumptions. Speak to a qualified professional before changing withdrawals, making substantial gifts, buying financial products or acting on a projection.