Plan for a healthier, longer life

| August 25, 2023

Our expectations of when we’ll die has a lot of implications for our financial planning. Few people want to think deeply about the subject, but it’s important to several facets of a plan. When we’ll take Social Security, assumptions about how long we’ll need retirement income, the implications for long-term care and other types of insurance, for example.

And it’s getting more difficult to understand our likely lifespan because with the notable exception of the last few years, we’ve been living longer. (COVID and the opioid epidemic have contributed to a recent decline in longevity.) The current life expectancy of a baby born in the U.S. in 2021 is about 76 years. Compare that with 1900, when we were living an average of 47 years. Advances in medical care and an increased awareness of staying active as we age have been main contributors to longer lives.

Today, among married couples, there’s a 50/50 chance one will live beyond 90. So in creating a financial plan, assuming you’ll live to 90 isn’t really a safe bet anymore.

Longer lifespans have a number of implications for society. I see one of the main ones being a changing workforce. I can imagine fewer and fewer people leaving the workforce at traditional retirement ages because they want to make sure they’ve saved enough for a longer life and because they don’t want to live that long in retirement. Over the long term, I can also imagine young people taking longer to start their careers.

My colleagues don’t report having many of these conversations with their clients yet. But we should be talking more about longer lifespans. The biggest risk I see in planning today is that people will have to drastically reduce their lifestyle because they’ve underestimated how long they’ll live.

I recently talked to someone who was in his early 50s and was doing minimal planning because he didn’t expect to reach 70. Both his parents died of cancer in their 60s. Now, genetics is a powerful factor in life expectancy. But there are way too many factors involved to assume that because your parents didn’t live into their 70s, 80s, or 90s, you won’t, either. For example, his father did die of colon cancer, but he never had a colonoscopy that could have extended his life significantly.

Despite the recent drop in life expectancy, we have a lot of reasons to believe lifespans will continue to increase. As Harvard Medical School Professor David Sinclair, who researches the aging process, says: “We’re developing the technologies to not just delay these diseases of aging but actually reverse aspects of them. Imagine you have a treatment for heart disease, but as a side effect you’d also be protected against Alzheimer’s, cancer, and frailty. You’d live a longer and healthier life.”

As I said a lot of factors go into how long you’ll live. But I think it’s prudent in the planning process to expect you’ll live longer than the previous generation did.


Evan R. Guido is the Founder of Aksala Wealth Advisors LLC, a 2018 Forbes Next-Gen Advisors List Member, and Financial Professional at Avantax Investment ServicesSM. Evan heads a team of retirement transition strategists for clients who consider themselves the “Millionaire Next Door.” He can be reached at 941-500-5122 or   Read more of his insights at Securities offered through Avantax Investment ServicesSM, Member FINRA, SIPC.  Investment advisory services offered through Avantax Advisory ServicesSM, Insurance services offered through  an Avantax affiliated insurance agency.  6260 Lake Osprey Dr. Lakewood Ranch, FL 34240.  The views and opinions presented in this article are those of Evan R. Guido and not of Avantax Wealth Management® or its subsidiaries.  Past performance does not guarantee future results. The S&P 500 is an index of 500 major, large-cap U.S. corporations. Standard & Poor's is a corporation that rates stocks and corporate and municipal bonds according to risk profiles. The S&P 500 is an index of 500 major, large-cap U.S. corporations. You cannot invest directly in an index.  An investment in a money market fund is not insured or guaranteed by the FDIC or any other government agency.  Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.  CDs are FDIC insured and offer a fixed rate of return.  They do not necessarily protect against a rising cost of living.  The FDIC insurance on CDs applies in case of insolvency of the bank, but does not protect market value.  Other investments are not insured and their principal and yield may fluctuate with market conditions. Investments are subject to market risks including the potential loss of principal invested.