Understanding the Retirement Spending Smile

By Brent Meyer — SafeMoney.com Founder & Editor Reviewed by Licensed Financial Professionals  |  SafeMoney.com — Trusted Since 2011  |  Updated Regularly Quick Answer: Discover the Retirement Spending Smile and how it affects your retirement planning. Learn to manage your spending effectively. Explore now! The Retirement Spending Smile: Why You Might Spend Less (Then More) Most people assume retirement spending is a straight line — steady, predictable, and consistent from year to year. But decades of research tell a different story. In reality, many retirees follow what economists call the “retirement spending smile,” a pattern where expenses start higher early in retirement, decline in the middle years, and rise again later in life. Understanding this pattern can help you plan more confidently, avoid surprises, and align your financial decisions with how retirement actually unfolds — not just how you imagine it. This guide breaks down what the spending smile means, why it happens, and how you can prepare for each stage, no matter where you live or what your cost of living looks like.  What Is the Retirement Spending Smile? The retirement spending smile describes how expenses typically change across three stages of retirement: Higher spending in early retirement Lower spending in mid-retirement Rising spending in late retirement The curve resembles a smile — high on both ends and lower in the middle. This pattern appears consistently among retirees across the U.S. regardless of income level, lifestyle, or state-specific costs. While your personal spending will vary, the general trend is common and well-documented. Stage 1: Early Retirement (Higher Spending) This stage often includes ages 60–70 , though timing varies. You’re newly retired. You feel energetic. You finally have free time — and you want to enjoy it. Many retirees spend more early on because they are: Traveling more Eating out frequently Updating their home Pursuing hobbies Helping family Making long-postponed purchases These are positive, intentional choices — not mistakes. But understanding this natural spending increase helps you plan for it without guilt or surprise. Q: Is it normal to spend more when you first retire? A: Yes. Most retirees do. Lifestyle spending often peaks early before settling into a steadier rhythm later. Stage 2: Mid-Retirement (Lower Spending) This stage often reflects the 70s and early 80s. During this period, many retirees: Travel less O