Retirement Planning In The Age Of Longevity
Retirement Planning in the Age of Longevity
Over the past 75 years, advancements in healthcare and healthier lifestyles have significantly increased the average American life expectancy. In 1950, the average life expectancy was 68 years, but by 2022 it had risen to 77.5 years. This increase in longevity means retirement planning has become more complex, as the retirement phase now has the potential to span decades. Longer life expectancies bring the challenge of ensuring savings last throughout an extended retirement, alongside rising inflation and healthcare costs.
The longer retirement period increases the risk of outliving savings, necessitating larger savings pools and more careful planning. Inflation further complicates retirement by eroding purchasing power, while healthcare costs often escalate with age, adding pressure to finances. To successfully navigate these challenges, retirees need a strategy that incorporates early and consistent saving, diversified investments, and multiple streams of income, such as Social Security, pensions, 401(k)s, …
