Retirees spend less than when they were working, but is this voluntary?

There have been a number of articles recently that point out that retirees tend to spend 70% or 80% of what they did when they were working.  This message is intended to reassure people that their savings may not be as inadequate as they feared.  Maybe the social security plus a $1000/month annuity payment will be enough?

Of course, you can't spend more than you have.  The typical 65 year old retires with a net worth of only about $130,000 and is constrained by this.  Most healthy retirees would like to travel more and do more things than they did during their working years, but they haven't got enough money, so they make do on less.

The big wild card is health care costs.  If we were to remain fairly healthy and then die at home one night unexpectedly at 85, the numbers might work.  On the other hand, almost no one has enough money for the most expensive costs, like prolonged nursing home stays, so why bother saving?

The present system is dysfunctional.  We need a better Medicare system that covers such things as nursing home care and prolonged home care with reasonable deductions and copays, just like is done in all the other advanced economies.

Here is the upbeat Wall Street Journal report on retirement spending.  Please click on the picture.