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As the baby boomers begin to retire, a great deal remains unknown about the evolution of wealth toward the end of life. In this paper, the author develops a new measure of household resources that converts total financial, nonfinancial, and annuitized assets into an expected annual amount of wealth per person. The author uses this measure, what he calls "Annualized comprehensive wealth," to investigate spend-down behavior among older households in the Health and Retirement Study. The analysis indicates that, in (real) dollar terms, the median household's wealth declines more slowly than its remaining life expectancy, so that real annualized wealth actually tends to rise with age over retirement.
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