Featured Post from Retire with Equity

Fear Of Running Out (FORO)

How neuroscience explains how we sabotage spending in retirement

Mar 28, 2025

10 min

Sue Pimento

Summary: The article explores the Fear of Running Out (FORO), a psychological phenomenon that stems from anxiety about resource scarcity, particularly in retirement. FORO is especially common among seniors who fear depleting their financial, physical, or emotional resources as they age. Unlike FOMO (Fear of Missing Out), FORO focuses on the depletion of existing assets, often leading to cautious decision-making, delayed spending, or self-sabotaging behaviours like excessive frugality or social withdrawal. While some instances of FORO are valid—such as retirees who underestimated their living expenses—others are more psychological, with financially secure individuals still feeling paralyzed by fear and unable to enjoy their retirement fully.  There are practical solutions, but they require more than just emotional support.  We also need to address the lack of formal retirement planning and literacy.  Most retirees have insufficient knowledge about tax-efficient asset drawdowns, and the limited guidance from financial institutions exacerbates these fears.


We’ve all heard of FOMO (fear of missing out)—that nagging anxiety when everyone else seems to be at a fabulous party while you’re at home scrolling through social media, eating last night’s leftovers straight from the container.


As we age, the fears we carry evolve—and for some, they get a little louder, quirkier, and much more challenging to ignore. A unique set of acronyms has emerged for older adults to describe these creeping anxieties. Allow me to introduce you to the unholy trinity of aging fears:


FOGO (Fear of Getting Old): This one typically kicks in around our mid-to-late 50s when the realization hits and panic sets in: "Wait... I’m not young anymore?" Have I saved enough? Have I experienced enough? Am I running out of time? Cue the classic symptoms: splurging on bright red sports cars, embarking on bucket-list trips to exotic locales, or dating someone who knows what "Netflix and chill" really means, not cozying up with a movie. And yes, sometimes while still married. It’s all part of the "midlife crisis" package—a desperate attempt to outrun Father Time. But let’s be honest: The comb-over isn’t fooling anyone.


FOBO (Fear of Being Old): This stage sneaks in during your 70s, as your "best before" date blinks ominously on life’s metaphorical packaging. Many enter into a state of "defensive denial," 

refusing to acknowledge their age or any limitations, insisting they are still as capable as ever, even when struggling with specific tasks.  In this stage, people can demonstrate "overcompensation - Desperately trying to prove they’re still youthful.  Many will refuse to use mobility aids or decline assistance from family or caregivers out of pride.  Others will shut down anyone who dares to suggest they are old. “Me? Old? Please. I just got a brand-new hip last year!”


FORO (Fear of Running Out): Now we get to the show's real star. FORO enters the spotlight as you thoughtfully consider retirement and suddenly takes over the plot. It’s the fear of running out—of money, energy, time, or maybe even snacks at movie night. This one’s a relentless buzz in the background of every decision, from how you spend your savings to whether you should buy name-brand peanut butter or settle for the generic jar. If left unchecked, FORO can steal the joy out of today by worrying too much about tomorrow. We have all heard the stories of people passing away with millions of dollars in the bank, yet they lived in squalor, afraid to spend their money.


Now, FORO can manifest in all kinds of ways. Some are almost funny in hindsight. Remember the pandemic toilet paper wars of 2020? Or that panic at a party when you’re convinced you don’t have enough food for your guests, only to find yourself drowning in leftovers? But for seniors in retirement, FORO often takes on a much more serious tone—like running out of money, energy, or health as the years go by. These thoughts can be terrifying for the aged. 


And sometimes, this fear is warranted. Imagine a retiree who underestimated their living expenses, burned through savings too quickly, and now faces the stark reality of financial insecurity. That’s a legitimate case of FORO that demands attention, planning, and maybe a shift in lifestyle.


But other times, FORO is more like a shadow in the dark—unsettling at first glance but harmless once illuminated. For example, some seniors with reasonable pensions, savings, and even supplemental income streams might still be too paralyzed by the fear of running out to take that dream vacation or help their grandchildren with school. In this situation, it is doubtful that there will ever be enough. This type of FORO can cause harm through neglect. This unfounded FORO can keep people from genuinely thriving during their golden years.


There are well-documented cases of individuals who have perished from thirst in the desert while carrying full bottles of water. They were too frightened of running out of water to save their lives by drinking it. Most of us shake our heads and think we would never do that, but FORO represents a compelling fear that can lead to self-sabotaging behaviours. If FORO could result in death in the aforementioned desert scenario, how might it influence decisions regarding our significant assets, such as our homes? Unfortunately, many retirees pinch pennies and go without while living in homes with considerable equity, refusing to access it for fear of running out (FORO).


So, how do we know when FORO is a valid warning signal and when it’s just a psychological hurdle? And, more importantly, how can we tackle this fear to ensure it doesn’t stand in the way of living a joyful, fulfilled retirement? Read on; we’ll dive deeper into the concept of FORO—why it exists, how it can sneak into our decision-making, and, most importantly, actionable strategies to manage it.


Remember, your golden years shouldn’t be ruled by fear—they should be a time to shine.


The Fear of Running Out (FORO) is a psychological concept rooted in anxiety about scarcity or insufficiency, particularly concerning essential resources like money, time, or opportunities. It's akin to FOMO (Fear of Missing Out), but instead emphasizes the anxiety of depleting one's existing resources rather than worrying about missed experiences.


While FORO has not been as widely studied as FOMO in academic circles, the term has gained traction in financial and psychological contexts, particularly regarding retirement planning, economic behaviour, and decision-making. Although it’s unclear who explicitly popularized the term “Fear of Running Out,” it has become a recurring theme in financial planning discussions and among behavioural psychologists studying how individuals manage uncertainty and risk.


The Psychology of FORO


FORO is deeply rooted in psychological concepts of scarcity and loss aversion, both key ideas in behavioural economics. Loss aversion, central to Daniel Kahneman and Amos Tversky’s prospect theory, highlights that the pain of losing something outweighs the joy of gaining an equivalent amount. In the context of retirement, the fear of running out of money reflects this principle—financial depletion carries the weight of losing essential aspects like security, independence, and quality of life, making it feel particularly distressing.


The work of researchers like Eldar Shafir and Senthil Mullainathan on the scarcity mindset further illuminates this phenomenon. They suggest that when people are preoccupied with avoiding resource depletion, they often develop tunnel vision, focusing narrowly on the immediate issue. For seniors worried about outliving their savings, this can manifest as excessive caution or hesitation in deciding to spend or draw down resources, even when such concerns may not be warranted. Faced with this dilemma, some seniors develop inertia, choose to do nothing, and ignore the situation altogether.


According to a 2024 report by the Ontario Securities Commission, 13% of pre-retirees and 19% of retirees among Canadians aged 50 and older have a formal written retirement plan, which is a significant cause for concern.


This reflects a widespread lack of structured financial and retirement literacy. Without a clear strategy, many individuals may not fully understand how to manage their resources effectively throughout retirement, particularly when it comes to de-accumulating (spending) assets in a tax-efficient manner. We can quickly start to see why many older Canadians have FORO.


One key issue is that minimal accessible information exists on strategies for drawing down retirement savings to minimize taxes while ensuring long-term financial security. For example, the timing and order in which individuals withdraw from registered accounts like RRSPs, TFSAs, non-registered investments, or access their home equity can dramatically impact their overall tax burden and available income in retirement. Unfortunately, this type of guidance is often overlooked in financial planning resources, leaving most retirees guessing how much money is enough.


The financial industry also contributes to this gap. Banks and many financial advisors are primarily compensated through commissions tied to the sale and management of investments, such as mutual funds or other financial products. This model does not incentivize them to provide comprehensive advice on strategically spending down savings. As a result, many seniors are left without the critical guidance they need to navigate the complexities of de-accumulation, leading to suboptimal emotionally driven decisions and increased financial stress.


This lack of tailored advice is particularly problematic for Canadians who rely on paying off their homes as their primary financial plan. While homeownership is a valuable asset, it is not liquid, and converting it into usable retirement income can be challenging without proper planning. The fear of running out of money (FORO) becomes especially acute for these individuals, as they may not have the financial and retirement literacy or tools to make informed decisions about how to fund their retirement, especially concerning using home equity.


In short, the low prevalence of formal retirement plans, insufficient education on tax-efficient de-accumulation, and the misaligned incentives of financial institutions significantly disadvantage seniors. This gap exacerbates financial insecurity and leaves many retirees vulnerable to the psychological and practical challenges of FORO, particularly those who rely on home equity, an illiquid asset, as their primary financial safety net.


Addressing these issues requires a broader emphasis on financial and retirement literacy and unbiased, accessible advice tailored to retirees' unique needs.


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Key Components of FORO:


1. Scarcity Mindset—Seniors facing FORO might develop a scarcity mindset, which can lead to overly frugal behaviours. For example, they may reduce spending on essential support services or forego social activities to protect their savings, even when financially secure.


2. Emotional Triggers—FORO is tied to deeper emotional needs like safety, independence, and legacy. At its core is the fear that people will have nowhere to live, won’t have enough money to care for themselves, and will not have any money left to leave a legacy.


3. Decision Paralysis - FORO can cause retirees to delay allocating resources, from downsizing a home to sourcing pension-type income. This indecision can lead to missed opportunities or unnecessary sacrifices.


4. Overcompensation—In some cases, the fear of running out can lead to self-sabotage behaviours like hoarding money or withdrawing from social activities. These behaviours reduce quality of life and increase feelings of isolation.


The Solution:


A comprehensive approach that combines emotional support, practical planning, and mindset adjustments is essential to helping retirees overcome FORO. By addressing their fears and financial realities, they can gain the confidence to enjoy their retirement years without worrying about running out of money.


1. Acknowledgement and Understanding - Listen and empathize: Begin by genuinely listening to the retiree's concerns, recognizing that FORO is an emotional issue tied to deep-seated fears about security and independence.


Normalize the fear: Reassure them that the fear of running out of money is common, especially in retirement. Explain the reasons behind this fear:

  • Retirees often can’t return to work to supplement income.
  • Lifespans and healthcare costs are unpredictable, creating uncertainty.
  • The transition from accumulating wealth to spending it feels unnatural to many.


2. Develop a Retirement Spending Plan—Create a tailored plan. Outline a sustainable spending strategy aligning with the client's lifestyle, goals, and resources:

  • Leverage expertise: Collaborate with their bank manager or financial advisor to develop a realistic budget covering essential and discretionary expenses.
  • Focus on balance: Establish a balance between meeting current needs and maintaining future security.


3. Generate Pension-Like Income - Explore income solutions: Help them research ways to create predictable income streams, such as:

  • Purchasing an annuity to convert part of their savings or equity into guaranteed income.
  • Consider equity mortgage products for additional cash flow if they have sufficient home equity.
  • Address misconceptions: Explain how these tools can reduce uncertainty and provide peace of mind.


4. Emergency Fund - Health care may be needed later in life and can be costly. Setting money aside for unexpected expenses will offer great comfort and peace of mind.


5. Mindset Shifts - Reframe perspectives: Encourage retirees to focus on the opportunities their resources provide rather than fixating on worst-case scenarios:

  • Promote enjoyment: Remind them that retirement is a time to enjoy the fruits of their labour, not live in constant fear. Highlight the importance of self-care and experiences that bring joy and fulfillment.


6.  Legacy Planning -  Address legacy concerns: Help them create an estate plan or designate resources for loved ones and causes they care about, ensuring their wishes are honoured:

  • Provide clarity: Show how planning for a legacy can reduce anxiety about leaving something behind while meeting their current needs.


The Fear of Running Out is more than just a financial concern—it’s a deeply emotional and psychological issue for seniors facing the unpredictability of retirement. By addressing this fear in practical and empathetic ways, we can give retirees the tools and confidence to enjoy their golden years without worrying about depletion or feeling like they need to stockpile financial "water bottles" for a drought that may never come.


And there you have it—FORO might be a formidable guest at the retirement table, but it doesn’t have to steal the show. By addressing the emotional roots of this fear, creating practical plans, and shifting the focus to what’s possible, retirees can turn their golden years into precisely that: golden. Remember, retirement isn’t about tiptoeing around scarcity; it’s about celebrating a lifetime of hard work and savouring the moments that make life rich. So, let’s leave FORO in the shadows where it belongs and step confidently into a retirement that truly shines.


And let’s be honest, no one wants their legacy to read: "Lived frugally, died rich, and missed the Boat to the Caribbean."



Don't retire---Re-Wire!


Sue

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Sue Pimento

Sue Pimento

Founder | CEO

Focused on financial literacy and retirement strategies. Authoring new book on home equity strategies to help seniors find financial freedom

Pension ReformInterest RatesHome EquityMortgagesReverse Mortgages

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The rest doesn’t matter without them; we’re not just talking about lifting weights. (Though, yes, lift some weights.) Regular physical activity provides numerous benefits for older adults, including a reduced risk of dementia and enhanced cognitive function. Exercise can help maintain brain health, reduce mental decline, and even reverse some age-related brain shrinkage. Additionally, physical activity can improve mood, reduce anxiety, and enhance balance and coordination, leading to a better quality of life. • Strength training enhances bone density, metabolism, and mental health. (Source: Mayo Clinic) • Flexibility and balance? Try yoga or tai chi. Harvard Health says they reduce pain and stiffness. • Mental fitness? Cue up Wordle, Canuckle (the Canadian cousin), or Sudoku. • Dancing? It's beneficial for your brain and your swagger  • Listening to music or playing an instrument can reduce stress and boost memory. Gold Medal Tip: Motivation is overrated; action is everything. Don’t be a couch potato. A new study conducted at the University of Pittsburgh School of Medicine shows that older adults who spend more time sedentary — such as sitting or lying down — may be at a higher risk for lower cognition and in areas linked to the development of Alzheimer’s disease, no matter how much they exercise! So make sure you show up, move, and the motivation will catch up. Wealth Training: Stop Hoping, Start Budgeting Here's a shocker: Retirement doesn't mean your expenses magically disappear. According to Steve Willems' podcast “10 Retirement Myths You May Not Want to Believe,” most retirees don’t spend less. Aside from the mortgage, spending remains surprisingly consistent, especially during the Go-Go years (ages 55-75)”. We like what we like: groceries, entertainment, travel, and stylish or comfortable clothes are still on our shopping lists. That’s why many of us in retirement will need to pay more attention to spending and budgeting. Check Obligation Spending Retirement is the perfect time to reevaluate expenses from obligation rather than genuine need or joy. Here's a thoughtful way to frame that idea: Retirement is the season of freedom, so why are you still paying for things that feel like a burden? Now that you’re no longer earning a regular paycheck, every dollar matters more than ever. This means it’s time to take a closer look at obligatory expenses. These might include: • Helping adult children financially (even when it stretches your budget) • Donating to every fundraiser or cause just because someone asked • Hosting large family gatherings that leave you exhausted and over budget • Maintaining memberships, subscriptions, or traditions that no longer bring you joy. (We talk a lot more about this in a previous post What’s your Retirement Plan B While generosity is admirable, it shouldn’t jeopardize your financial security or peace of mind. Retirement should focus on investing in what truly matters to you now, rather than keeping up appearances or adhering to outdated expectations. Here’s a gentle mantra to adopt: “I’ve earned the right to say no with love and confidence.” Freeing yourself from obligation spending doesn’t mean becoming stingy; it means becoming intentional. Give where your heart feels full, not where your guilt feels heavy. After all, you didn’t work all those years to keep writing checks out of habit. Balance Beam- Budget What’s your plan when overtime isn’t an option and the budget doesn’t balance? Start with a good old-fashioned reality check: • Write down ALL expenses. • Tally up your income. • Look for a surplus (yay, trip!) or a shortfall (boo, time to pivot). Look at Canadian Government Pensions • Here's the math.  Old Age Security (OAS): Max is about $713/month or $8,556/year. And don’t forget the dreaded government clawback (formally known as the Old Age Security Pension Recovery Tax which starts at ~$90,997. • Canada Pension Plan (CPP): The average monthly payment is $758, while the maximum is $1,364 per month or $16,368 per year. So with these two programs combined, provided you meet requirements, as a senior, you're looking at somewhere between $17,000–$25,000/year before tax. If your lifestyle needs a bit more jazz hands, here’s how to bridge the gap:   DIY Income Builders: • Slash debt. Every dollar you don't spend is one you keep. • Downsize and bank the equity. • Buy or build an ADU and rent it. I have written more about ADU's here. • HELOC or Reverse mortgage (borrow strategically). • Withdraw from investments (4% rule). • Monetize your skills: consulting, tutoring, or writing that novel you started in 1993. Gold Medal Tip: Track your joy per dollar. If you’re going to spend, make it worth it. Rewire, Don’t Retire: Finding Purpose The biggest myth of retirement? That doing nothing feels good forever. (Spoiler alert: it doesn’t.) Passion is your GPS. It guides you towards what fills your heart. Whether you write poetry, walk dogs, or paint birds wearing tiny hats, your joy matters. And legacy? That’s just purpose with staying power. There’s science to support the benefits of this lesson. A study in JAMA Psychiatry found that people with a sense of purpose had a lower risk of mortality and disability  Purpose-Driven Paths: • Volunteer: Look for a cause that fires you up. • Get a part-time job: Perhaps you can fill in at a local bookstore, garden center or be a barista? • Hobbies: Take up painting, pottery, or poetry. • Go Back to School: Many Universities such as The University of Toronto offer free, non-credit courses through programs as part of their community outreach.  Seniors (over 60) enrolled at York University may have all or part of their academic fees waived at the domestic fee rate for York University degree credit courses as part of their mature student program. • Spend real time with people you love, maybe your grandkids or elderly parents. • Reconnect with old friends – not just on Facebook, but in person • Get out of your backyard and see the world Gold Medal Tip: You're never too young (or too old) to chase what lights you up. Start a business, get that degree you always wanted, and write that book. Go. For. It. Support: No One Trains Alone Retirement can be lonely. As we age, friends pass, routines fade, and isolation creeps in. That’s why your squad matters more than ever. Find Your Pod: • Family & Friends: Set expectations. Ask for help. Host Sunday dinners. Stay connected. • Fitness & Social Clubs: Join a walking group or participate in a gym class, followed by regular post-sweat coffee. • Faith Communities: Spirituality and structure in one. Sing in the choir. Serve at events. • Third Places: As sociologist Ray Oldenburg says, these are neutral hangouts like libraries, community centers, or your local café. They’re tied to lower loneliness and better mental health. Think of Cheers: “Where everyone knows your name!” Gold Medal Tip: Your local pickleball court or knitting circle might just be your new training ground. Attitude Training: Stop Acting Your Age Here’s a radical thought: Maybe we feel old because we act old. Want to stay young? Stay curious, try new things. Try line dancing, pickleball, bird watching, improv, or learning to code. Yes, code. What was the worst advice our mothers gave us? “Act your age.” Nonsense! Whoever said, “You’re only as old as you feel” was on to something – but let’s take it up a notch: How about you’re only as old as your playlist! The Power of a Youthful Attitude in Retirement A successful retirement isn’t just about savings accounts and spreadsheets — it’s about mindset. A positive, youthful attitude is one of the most powerful (and overlooked) assets you can carry into retirement. Even if you don’t feel youthful or optimistic, “fake it ‘til you make it” is more than just a catchy phrase—it’s a strategy. The goal isn't to accurately describe your aches, fears, or fatigue but to set yourself up for success! Science backs it up: a positive outlook boosts health, sharpens cognition, and increases longevity. From a practical perspective, optimism makes it easier to try new things, adapt to change, and enjoy the present—all essential in retirement. So, if the voice in your head says, “I’m too old for that,” try responding with, “This is my time.” You begin to build because what you tell yourself matters, as does what you believe. Retirement is your reward. Approach it like the vibrant, capable, unstoppable human you are because attitude, not age, sets the tone. Gold Medal Tip: You’re only as old as the last thing you tried for the first time. Try something ridiculous, I double dare you! Final Stretch The Retirement Games are here, and let me be crystal clear: this isn’t amateur hour. This is your Olympic moment, with medals awarded for stamina, strategy, and a solid sense of humour. Whether you're rounding the first turn at 45 or doing your victory lap at 75, now is the time to train. You’ve built strength, stretched your budget, flexed your purpose muscle, assembled your dream team, and rebooted your mindset. Now it’s time to lace up, lean in, and live life to the fullest. This isn’t about perfection; it’s about preparation. You won’t achieve a podium finish through wishful thinking; you’ll attain it through action, adaptation, and a great deal of repetition. So, put on your metaphorical tracksuit (or actual tracksuit if it's laundry day) and begin training with determination. The gold medal retirement isn’t just possible—it’s within reach. Cue the confetti cannon. You’re not just aging—you’re advancing. And champions, as we know, don’t retire… they rewire, recharge, and rewrite the playbook. On Your Marks, Get Set, THRIVE! Don’t Retire … Re-Wire! Sue

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