Death Anxiety and Executing Life's Financial Denouement: Death Anxiety's Effect on Lifespan Estimation and Financial Planning



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Retirement planning consists of two distinct phases: accumulation and decumulation. Accumulation is the process in our adult life that financially prepares us for retirement through saving and investing. Decumulation consists of determining one's lifespan expectancy and deciding how to spend the wealth one has accumulated. While some retirees spend too little, many retirees underestimate their lifespan and how far their savings will need to go. These retirees are left with little to sustain them later in life when expensive health problems tend to arise. The problem of decumulation has become of much interest in recent literature as researchers seek to understand retiree spending decisions. This research seeks to explore the relationship between age and death anxiety and the effects that death anxiety has on lifespan estimation and retiree spending. Utilizing a multimethod approach, this research consisted of four interviews with retiree- aged individuals, two interviews with financial advisors, and an Amazon MTurk survey with 130 subjects. In all three studies, there was no indication that increased age leads to an increase in death anxiety. Study 3 found a Pearson correlation of -0.007 between age and death anxiety (p = 0.9; N=130). Study 3 found some evidence of death anxiety influencing live-to age estimation accuracy (r = -0.094; p=0.29; N=130). However, mother's age had a stronger effect on an individual's live- to age estimation than death anxiety (r = 0.271) and every interviewee in study 1 cited their mothe's age as reasoning for their own live-to age estimation. And finally, this research found that individuals high in death anxiety could plan to spend more than those lower in death anxiety shown by how an increase in death anxiety can lead to an increase in the tendency to spend. Study 2 found that spending had to be encouraged as many clients had been hyper savers their entire life. Study 3 also found that the statement, “I worry about running out of money,” had a strong negative Pearson Correlation of -0.424 (p < 0.05; N =130) with Death Anxiety.



Death anxiety, Decumulation, Lifespan estimation, Spending, Retirement, Finance