Why some Canadians die with too much money

Yes, you read that right.

Most retirement articles focus on the fear of running out of money. And while that's a legitimate concern, there's another retirement risk that receives far less attention:

Dying with far more money than you ever needed.

Imagine reaching age 90 with a healthy investment portfolio, substantial savings, and very few financial regrets.

Sounds ideal, right?

Maybe.

What if getting there meant saying no to trips you wanted to take, experiences you wanted to have, and opportunities to spend time with family because you were worried about spending too much?

Retirement planning is often framed around one question:

"Will I run out of money?"

But there is another question that deserves equal attention:

"Am I allowing my money to serve the life I want to live?"

After spending decades saving diligently, many retirees find it surprisingly difficult to switch from accumulating wealth to using it. As a result, they continue living far below their means, postponing experiences they've worked their entire lives to enjoy.

The goal of retirement planning isn't to leave behind the largest possible account balance. It's to use your resources in a way that supports the life you want to live while maintaining confidence that your future needs will be met.

Ironically, one of the biggest challenges in retirement isn't learning how to save. It's learning how to spend.

It's more common than you think

If this sounds surprising, you're not alone.

Research shows that many retirees actually reduce their spending during retirement despite having the financial resources to maintain their lifestyle.¹

In other words, this isn't simply a matter of retirees lacking money. In many cases, it's a matter of retirees being reluctant to use it.

After decades of focusing on saving and preserving wealth, spending from a portfolio can feel uncomfortable, even when the numbers suggest it's entirely reasonable.

The saver’s dilemma

For most people, retirement is the first time in their lives when spending becomes the primary financial objective.

Think about it. Throughout your working years, you're constantly encouraged to save more. Contribute to your RRSP. Maximize your TFSA. Pay down debt. Build your emergency fund. Increase your retirement savings.

These are all valuable habits. In many cases, they're exactly what helped create financial security in the first place.

The problem is that habits built over 30 or 40 years don't disappear overnight. Many retirees continue thinking like accumulators long after they no longer need to.

A market decline feels like a threat, even when their retirement income plan remains intact. A larger account balance feels reassuring, even if the money isn't being used. Spending on travel, hobbies, or family can feel irresponsible, despite being fully affordable.

In other words, the behaviours that helped build wealth can sometimes make it difficult to enjoy it.

The "one more year" mindset

Have you ever heard someone say:

• "I'll retire after one more bonus."
• "I'll retire once the market recovers."
• "Maybe next year."
   

Sometimes these decisions are financially justified. But often, they're driven by something else entirely: uncertainty.

Many people reach a point where they could comfortably retire but struggle to believe it. After decades of working, earning, saving, and planning, stepping away from that routine can feel uncomfortable. Continuing to work feels safe; spending feels risky.

The result is what some call the "one more year syndrome."

One more year turns into two. Two turns into five.

The dream trip gets postponed. Time with family gets delayed. Plans that once felt urgent slowly become optional.

While there is nothing wrong with working longer if you enjoy it, it's worth asking an important question:

Are you working because you want to, or because you're afraid not to?

Why spending feels so risky

To be fair, retirees have legitimate reasons to be cautious. No one knows exactly how long they will live.

Healthcare costs may increase later in life. Inflation can reduce purchasing power. Markets experience periods of volatility. Unexpected expenses can arise.

Many retirees also want to leave something behind for their children, grandchildren, or charitable causes they care about.

These concerns are real and deserve careful consideration.

The challenge is that uncertainty can sometimes lead people to become overly cautious.

When every future possibility is viewed as a threat, the default response becomes holding on to as much money as possible.

But retirement planning isn't about preparing for every imaginable scenario. It's about preparing for likely scenarios while still allowing yourself to enjoy the life you've worked so hard to build.

There is a difference between being prudent and being paralyzed.

The hidden cost of under-spending

When people think about retirement risks, they usually focus on running out of money.

Far fewer consider the possibility of running out of time.

Many of the experiences retirees dream about are easier to enjoy in their 60s and early 70s than in their 80s and 90s. As you age, travel may become more difficult, health challenges may arise, and energy levels may change.

As time goes on, the opportunity to help family members may also look different. Providing financial assistance to adult children when they're buying a first home or raising a young family can have a far greater impact than a larger inheritance received decades later.

Of course, every family situation is unique. The point isn't to spend recklessly. It's to recognize that money has the greatest value when it is used intentionally.

Many retirees spend years worrying about outliving their money. Far fewer consider the possibility of outliving their ability to enjoy it.

A decumulation plan is about more than withdrawals

When people hear the term "decumulation," they often think about technical topics such as RRIF withdrawals, CPP timing, OAS planning, and tax strategies.

Those decisions are important. But at its core, a decumulation plan is about something much simpler.

It's about answering the question:

"How much can I safely spend while still maintaining confidence in my future?"

A well-designed retirement income plan creates structure around your spending decisions. It helps you understand where your income will come from, how your assets can support your lifestyle, and how different scenarios may affect your long-term outlook.

Most importantly, it provides something many retirees need: permission. Permission to take the trip, spend time with family, support causes you care about, and, at the end of the day, enjoy the wealth you've spent decades building.

Finding the right balance

The goal isn't to spend every dollar or preserve every dollar. The goal is balance.

A successful retirement is about using your resources thoughtfully to support your lifestyle, priorities, family, and the legacy you want to leave behind. Money is a tool that can help you do that.

If you're approaching retirement, are already retired, or helping a family member navigate these decisions, we can help. Together, we'll build a retirement income strategy that aligns with your goals, supports the lifestyle you want, and helps you make informed decisions about both saving and spending.

Sources

The Psychology of Retirement Income: From Saving to Spending. June 3, 2024. Morningstar. https://www.morningstar.com/personal-finance/psychology-retirement-saving-retirement-income.  

Why retirees underspend, and what advisors can do about it. September 16, 2025. InvestmentNews. https://www.investmentnews.com/opinion/why-retirees-underspend-and-what-advisors-can-do-about-it/262125.