Try this at your next party. Ask someone how old they think will be when they die. It’s an odd question to ask, but I can bet they will come up with a precise number in about 5 seconds or less. Either that or they will make a B line for the cheese dip at other end of the room. At least, that’s been my experience.
What’s your number?
My number is 100. My wife’s is 87. I am not talking sleep numbers here. That’s how long we expect to live. Apparently, I am a little more optimistic than she is.
The follow up question to the one above is “Why do you think you will die at that age”. Then their story unfolds. In my case, my grandpa is still living, and living well, at 94. His mother lived to be about the same age. I figure I will live at least as long as them. Not that I have any evidence to back it up, just a hunch.
My hunch is you will live to a ripe old age as well. In fact, you will probably live longer than you think. According to the Social Security Administration, the life expectancy of the average woman turning 65 year this year is age 86.6; for men it’s 84.3.
Obviously those are averages. Some of us won’t see those ages, but many will live to be a lot older. The Social Security Administration estimates that one 65-year-old in four will live to age 90; one in ten to age 95.
So far, no human being has ever lived past age 122. But scientists are working hard to change that. In fact, some believe that the first human to live past age 150 has already been born.
Bankrate.com published a survey earlier this year showing that running out of money ranked #2 among top retirement fears. Your retirement income plan needs to reflect the fact that you may live longer than you thought. Even if you don’t believe you will, you need to consider the possibility that you may.
Whatever your number was above, add at least 10 to that number. For most people, that means a retirement income plan that lasts until your mid 90’s or beyond. Normally, when I complete a retirement plan I will run the numbers out to age 100. For most people, inflation takes its toll and assets are eventually spent down to zero. If that happens during your lifetime, you have a problem.
To learn how a “bottom up” strategy to retirement income planning can create retirement income for life, check out this page.
Whether you expect to or not, odds are good that you will live a long life. Perhaps longer than you ever thought possible. Make the most of it by making sure your money lasts as long as you do.
I not only expect to live to age 100, I am planning on it. How about you?
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