What do people fear the most in retirement? Running out of money.
What variable has the largest impact on whether or not you will outlive your income? Life expectancy.
According to the Social Security Administration, a man who reaches the age of 65 today, is expected to live until he is 84 years old?* Add three years to that for the average woman. Plus, 25% of all 65-year-olds will live past 90 and 10% will live beyond 95. That’s the potential for a 30-year retirement!
It’s a touchy subject, but a life expectancy analysis is one of the best ways you can help ensure you don’t outlive your hard-earned income so you can maintain a comfortable lifestyle and have choices in retirement. But where do you begin? Unfortunately, estimating longevity is not even close to an exact science. Traditionally, financial advisors rely on actuarial tables for the best estimate. However, with life expectancy increasing practically every year, the mortality tables may no longer be enough…
To help increase the success of your retirement plan and accurately estimate your life span, you’ll want to have an honest discussion with your financial advisor around subjects like your medical history, family history, and lifestyle habits.
The following are some questions you may want to think about.
Medical and Family History
- Have you ever had a heart attack or been diagnosed with any kind of heart disease?
- Are you or have you ever been on cholesterol medication?
- Have you ever been diagnosed with high blood pressure? If so, do you take blood pressure medication?
- Have you or anyone in your immediate family (parents, grandparents, siblings) ever had a stroke?
- Have you or anyone in your family ever had cancer?
- Are your parents alive? If so, what is their health status today? If not, what was their cause of death and at what age did they die?
- Are all of your siblings still alive?
- Have any of your siblings experienced any serious health problems?
Lifestyle Habits
- On a scale of 1-10, with 10 being a health nut and 1 eating fast food every day, how would you rank your diet?
- Do you exercise regularly? If so, how many times a week and what type of exercise do you do?
- Do you or have you ever smoked? How often?
- How many days a week on average do you consume alcohol?
- Do you always, sometimes, or never wear a seat belt?
- On a scale of 1-10, 10 being you could “go postal” any second and 1 being cool as a cucumber, how would you rank your daily stress levels?
- On average, how many hours do you sleep a night?
- Do you participate in high-risk sports or activities (i.e. skydiving, football, downhill skiing, etc.)
Obviously, no one knows for sure how long you will live. But discussing these questions and comparing your answers to actuarial tables certainly can provide the best possible estimate and increase your probability of a successful retirement plan. Plus, once you know “your number,” you can get back to planning (or enjoying) all of the fun stuff you’ve envisioned yourself doing for so many years.
To discuss your longevity and better understand how it aligns with your existing retirement plan, give us a call at 810-593-1624 to talk with one of our financial advisors or schedule an appointment here.
