@article {10631, title = {How Do Retirees{\textquoteright} Spending Patterns Change Over Time?}, journal = {EBRI Issue Brief}, year = {2019}, type = {Journal}, abstract = {Using the Health and Retirement Study (HRS) and the Consumption and Activities Mail Survey (CAMS), we examine spending behavior of older Americans for the 50{\textendash}64, 65{\textendash}74, and 75-or-older age groups between 2005 and 2017, biennially.  Average annual total spending is lower for households in older age groups compared with those in younger age groups.  Housing is the largest spending category for every age group, and in all survey years studied except 2017, the median share of households{\textquoteright} budgets allocated to housing expenses was smaller for older households.  On average, households spent less on food as they grew older, and the average dollar amount spent on workrelated expenses such as transportation and clothing declined by age.  The average amount spent on entertainment declined by age, and older households allocated a larger share of their budgets to gifts and contributions.  The share of health care costs in households{\textquoteright} budgets increased with age. However, the average annual share of health costs for the 65{\textendash}74 and 75-or-older age groups declined after 2007, the year after Medicare Part D went into effect.  Across all age groups, for low-income households, a larger share of expenses was spent on housing and food compared with high-income households. This increased spending on necessities was offset by a reduction in the average share of spending on entertainment and gifts and contributions.  Median total income was lower for households in older age groups. In addition, they had higher median spending-to-income ratios than younger age groups.  The fraction of households who spent more than their income increased with age. However, the average amount overspent was lower for older age groups compared with younger age groups.  Median non-housing wealth increased with age but leveled off and even declined as households reached ages 75 or older. In addition, it was much lower for households with deficits {\textemdash} those who have spent more than their income {\textemdash} than for households without deficits.}, keywords = {spending patterns}, issn = { 0887{\textendash}137X/90 0887{\textendash}137X/90}, url = {https://www.ebri.org/docs/default-source/ebri-issue-brief/ebri_ib_492_spendovertime-3oct19.pdf?sfvrsn=9f503c2f_10}, author = {Zahra Ebrahimi} }