Page 1 Page 2 Page 3 Page 4 Page 5 Page 6 Page 7 Page 8 Page 9 Page 10 Page 11 Page 12 Page 13 Page 14 Page 15 Page 16 Page 17 Page 18 Page 19 Page 20 Page 21 Page 22 Page 23 Page 24 Page 25 Page 26 Page 27 Page 28 Page 29 Page 30 Page 31 Page 32 Page 33 Page 34 Page 35 Page 36 Page 37 Page 38 Page 39 Page 40 Page 41 Page 42 Page 43 Page 44 Page 45 Page 46 Page 47 Page 48 Page 49 Page 50 Page 51 Page 52 Page 53 Page 54 Page 55 Page 56 Page 57 Page 58 Page 59 Page 60 Page 61 Page 62 Page 63 Page 64 Page 65 Page 66 Page 67 Page 68 Page 69 Page 70 Page 71 Page 72 Page 73 Page 74 Page 75 Page 76 Page 77 Page 78 Page 79 Page 80 Page 81 Page 82 Page 83 Page 84 Page 85 Page 86 Page 87 Page 88 Page 89 Page 90 Page 91 Page 92 Page 93 Page 94 Page 95 Page 96 Page 97 Page 98 Page 99 Page 100 Page 101 Page 102 Page 103 Page 104 Page 105 Page 106 Page 107 Page 10861 CHAPTER 3 | ECONOMIC PREPAR ATION FOR RETIREMENT showed a drop in spending at retirement, even for those who retired when they planned, which was at odds with the theory and came to be known as the retirement-consumption puzzle. A potential concern for policy makers is that a steep drop in spending at retirement could reflect an under- lying lack of economic preparation. In the past, research on this topic was hindered in part by a lack of quality longitudinal data on consumption expenditure and time use in retirement linked to relevant financial and health information. The CAMS questionnaire asks about spend- ing, how people spend their time in retirement, and how spending changes at the time of retire- ment (for those who are retired). For those who are not yet retired, it asks participants how they expect their spending to change when they retire. Researchers use these data to shed light on the retirement-consumption puzzle to determine whether or not a puzzle even exists. Hurd and Rohwedder (2004) examine actual changes in spending at retirement and to what extent these changes were anticipated. In the group not yet retired, about 69% say they expect to decrease spending with retirement, while 4% expect to increase spending. Fifty-two percent of retirees report that they reduced spending when they retired, while about 12% say they increased spending. Using longitudinal data on spending, Hurd and Rohwedder (2005) follow the same people to see if the changes they anticipated were the changes that actually occurred. Of those who retired between waves, 59% anticipated a decline in spending, but only 46% recalled their spending declining after they retired. There is no evidence of unanticipated declines in spending at retire- ment and no change in spending at the median. There are considerable increases and decreases in spending across some households, however (Hurd and Rohwedder 2008). Households with less retirement wealth are more likely to experience declines in spending at retirement and are also more likely to retire early because of poor health. In follow-up work that uses four waves of CAMS data (2001 to 2007), Hurd and Rohwedder (2013) confirm earlier findings of relatively small drops in spending at retirement on average, which could be accounted for by lower work-related expenses or from having more time to cook at home rather than eating out. However, those in the lowest A potential concern for policy makers is that a steep drop in spending at retirement could reflect an underlying lack of economic preparation. FIGURE 3-3  Percent with DB or DC pension, and any pension coverage: 1992-2014   Source: HRS 1992-2014. 0% 5% 10% 15% 20% 25% 30% 35% 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 Defined benefit (DB) Type of pension: Defined contribution (DC) Any coverage