Don’t have a retirement withdrawal strategy? You aren’t alone.

03.17.2026 | Category: Navigating Your Retirement

Reviewed by: Nate Hobson
Financial Advisor & Mutual of Omaha National Advisor Sales Director

Estimated Read Time: 6-7 minutes

Summary: A recent Mutual of Omaha survey* revealed many retirees are reluctant to spend and unsure how long their savings will last. With many lacking a formal retirement withdrawal strategy, fears about inflation, health care costs and longevity can lead to unnecessary underspending. But by planning for a range of outcomes, staying flexible and combining personalized strategies with dependable income sources, retirees can turn uncertainty into confidence for this new chapter of life.

Mark Zagurski, Mutual of Omaha’s director of advisor strategy and operations and host of the Make it Personal Podcast, advises retirees to think of their savings as a battery.

“You spent years charging it,” he said. “That was its job then. But now that you’ve retired, the purpose of your battery has changed. Its job is to no longer keep charging. Its job is to power this next chapter in life.”

Unfortunately, many retirees are hesitant to put their “battery” to work, fearing it’ll run out of juice too soon. Nearly half of respondents to a recent Mutual of Omaha survey* say they’re concerned about running out of money.

“I worry about outliving my retirement savings and that I’m withdrawing too much now,” said one 65-year-old female survey respondent with between $100,000 and $250,000 in investable assets.

Most people understand the importance of saving for retirement. But far fewer understand what comes next — how to enjoy their savings confidently without concerns about overspending.

This next phase has a name: decumulation.

Plan ahead. Download our free retirement drawdown strategy checklist today.

What is decumulation and why does it matter?

Decumulation simply means using a retirement withdrawal strategy to provide a stream of reliable income that’ll last throughout retirement.

In the past, many retirees relied on pensions that provided guaranteed income for life. Today, most people retire with 401(k)s, IRAs and other savings accounts. This shift means retirees are now responsible for deciding:

How much to withdraw
When to withdraw it
Which accounts to use
How long the money needs to last

Despite the importance of these decisions, the survey shows just 19% of retirees and 27% of near retirees recognize the term “decumulation.” About 40% say they have no plan for how they’ll spend down their savings.

Without a plan to guide them, retirees are often afraid to spend, fearing they won’t have enough money to cover big, unpredictable expenses, such as health care or housing.

Confidence in Social Security waning

The survey shows 91% of respondents expect Social Security benefits to be part of their income stream in retirement — 96% of retirees rely on it already and 80% of those nearing retirement expect to.

While most say Social Security is or will be an important part of their retirement income strategy, confidence that it’ll cover essential expenses remains relatively low. Just 17% of the survey population say they’re very or extremely confident their Social Security benefits will be enough to cover their needs.

“I don’t want to rely on Social Security alone … also health issues could be very costly later on,” said one retired male respondent with between $100,000 and $250,000 in investable assets.

Understanding your retirement needs

No one knows exactly how long they’ll live, which makes retirement planning tricky.

That uncertainty causes many retirees to underspend, even when they can afford to spend more.

Nate Hobson, national sales director of Mutual of Omaha’s advisor network and a financial advisor, recommends building a plan that isn’t based on living to a specific age. Instead, it’s more important to prepare for a range of possibilities.

People make the common mistake of building a retirement plan based on average life expectancy. Considering half of all people live longer than the average, that strategy can lead to problems. A safer approach is to plan as if you might live into your late 80s or 90s and make sure your strategy would continue to work if you lived even longer.

“You really never know how long you’ll live,” said one female respondent who has saved between $100,000 and $250,000 in investable assets. “Also, nobody can predict what large expenses will come up in the future.”

Many personal factors, such as family health history, current health, lifestyle and access to quality health care all play a role in how long a person can expect to live.

On top of preparing for a long life, those nearing retirement should also plan for a longer retirement in case they leave the workplace earlier than expected.

Of the retirees surveyed, 53% say they retired a little or much earlier than expected. The results show a significant difference when further broken down by gender: 56% of women say they retired earlier than they’d expected compared to 47% of men.

The impact of inflation

Inflation is another factor that has retirees fretting about overspending. As prices rise, the purchasing power of their savings declines. Among survey respondents, 60% are concerned about the impact of inflation.

To help ease those worries, Mutual of Omaha financial advisor Adam Olson, a Certified Financial Planner, recommends separating needs from wants when planning for inflation. It’s wise to assume the costs of core needs — food, shelter, clothing, taxes, health care and insurance — will increase at least 3% a year throughout retirement, he said.

Wants, such as travel and leisure, are handled differently. Spending on these luxuries typically peaks early in retirement and gradually declines later in life.

“We strategically plan for lower spending on wants in the mid-70s and mid-80s,” Olson said. “That creates a more realistic long-term plan.”

“It’s important to remember retirement plans should never be set in stone, Hobson said. Markets experience volatility. Health and goals change. Taxes increase. Reviewing your plan regularly provides opportunities to adjust spending, savings or investments before factors outside your control cut into your savings.”

How much can you safely spend in retirement?

Because retirement looks different for everyone, there isn’t a one-size-fits-all answer to how much or when to start spending during retirement. The numbers reveal people are cautious about spending right away.

Just 22% of retirees say they started spending immediately and 35% say they’ll only spend if absolutely necessary.

When it comes to how much to spend, the 4% rule of withdrawal has long been a popular spending strategy. Using this approach, a retiree withdraws 4% of their retirement savings in their first year and then adjusts for inflation in subsequent years.

While the rule has merit, Zagurski warns spending plans require much more flexibility to accommodate the unexpected.

“The 4% rule can be a helpful starting point, but it was never meant to be a one-size-fits-all solution,” Zagurski said. “Real life is more dynamic. Spending patterns, market conditions, taxes and health all matter. Today, most retirees benefit from a more personalized, flexible approach.”

Mutual of Omaha provides a free online calculator to help you determine how long your savings may last based on your withdrawal rate.

Where does retirement income come from?

Income during retirement can come from a variety of sources — Social Security, pensions, a reverse mortgage, an investment portfolio or a part-time job.

While the income from these sources may appear reliable on paper, many retirees overlook gaps that can chip away at their savings.

Some common and costly mistakes include taking large lump-sum withdrawals, ignoring the impact of taxes, leaving money idle in cash or not coordinating withdrawals across accounts. When markets decline, withdrawing money at the wrong time can permanently reduce retirement savings.

For some retirees, annuities and insurance products can help create a reliable income floor — covering essentials, regardless of market conditions. But it’s important to understand the role these products play in a comprehensive retirement strategy.

“They’re not about maximizing returns,” Zagurski said. “They’re about increasing confidence and predictability.”

A sustainable plan is flexible — not perfect

A comprehensive withdrawal strategy balances income needs with flexibility. It considers taxes, market conditions and multiple income sources and it gets revisited regularly.

“The best plans aren’t static; they adapt as life and priorities change,” Zagurski said.

Unfortunately, many people don’t have a clear sense of how frequently they should evaluate their plan: 25% believe they should check it monthly, 33% say quarterly and 30% say annually. A small percentage — 9% — believe they don’t ever have to check or adjust their plan.

Wrapping it all up

Retirement spending doesn’t have to be guided by fear or guesswork. With a flexible withdrawal strategy, realistic assumptions and reliable income sources, it’s possible to use your savings with greater confidence. By planning thoughtfully and regularly revisiting your approach, you can turn the savings you worked hard to build into support for a more secure and fulfilling retirement.

Build your plan

To start building a retirement withdrawal plan you can be confident in, download our free Retirement Drawdown Checklist and schedule a meeting with a Mutual of Omaha financial advisor.

Frequently asked questions (FAQs)

What is a decent amount of money to retire with?

There’s no universal number, according to Olson. Instead, you should ask yourself, “What do I want retirement to look like?” A financial advisor can help define your retirement vision, estimate the cost of that lifestyle and compare it to your resources. If there’s a gap, the options are simple: work longer, spend less or do some of both.

What is the average 401(k) balance of a 65-year-old?

According to a 2025 Vanguard report, the average 401(k) balance among Americans age 65 and older is $299,442. The median 401(k) balance for Americans 65 and older is $95,425.^*

Reviewed by: Nate Hobson

Financial Advisor & Mutual of Omaha National Advisor Sales Director

Nate Hobson leads a team of Financial Advisors as Mutual of Omaha’s National Sales Director, Advisor Network. He is passionate about helping individuals and families make confident financial decisions that can help lead to lasting peace of mind.

*About this survey: Mutual of Omaha worked with research vendor, quantilope, to conduct research related to Decumulation – the strategic drawdown of assets during retirement years. This research had a sample size of 496 respondents aged 50+ who were already retired (n=327) or nearing retirement (n=169) within the next 10 years. Respondents who stated they did not have at least some assets to draw down during retirement were excluded from the survey. The research was conducted in a 10-minute online survey from October 6-15, 2025. All data included in this report are based on Mutual of Omaha proprietary research unless otherwise noted.

Sources:

^*Vanguard, How America Saves 2025, accessed Feb. 6 2026, workplace.vanguard.com/content/dam/inst/iig-transformation/insights/pdf/2025/has/2025_How_America_Saves.pdf

Disclosures:

Registered Representatives offer securities through Mutual of Omaha Investor Services, Inc., Member FINRA/SIPC. Investment Advisor Representatives offer advisory services through Mutual of Omaha Investor Services, Inc. Not all Mutual of Omaha agents are registered representatives or financial advisors.

Mutual of Omaha and its representatives do not provide tax and/or legal advice, and the information provided herein is general in nature and should not be considered tax and/or legal advice.

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