PLANNING
Living longer
It is tremendous news that on average we are now living considerably longer
than the generations before us and it is common to see people living without
impairment into their 80s and even 90s.
Children born now are expected to live well into
their 90s and by 2055 it is forecast that, on average,
women will live to 100, such are the medical and
lifestyle advances that surround us.
The stark choice is that you need to build a bigger
retirement fund, or prepare to live on a lot less
money than you are now.
The flipside of this extended life is that someone
has to pay for it. With more people retired in
relation to the working (and tax-paying)
population, the government cannot fund much
more than survival rations for pensioners.
Key points
The younger you are now, the longer your life
expectancy, due to healthier living and
medical advances
Rising life expectancy must be paid for
– you need to save more
Worse still, the annuities we buy with our pension
pots have to take into account our longer lives, so
are reducing, and if you are building your own
retirement fund to draw down, you will need to
plan for it to last longer.
It is unlikely that company or state pensions
will increase in line with life expectancy
85
80
75
Life expectancy
70
Females
65
Males
60
55
50
45
40
1841 1851 1861 1871 1881 1891 1901 1911 1921 1931 1941 1951 1961 1971 1981 1991 2001 2011
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Page 10
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9
English Life Table number and time period covered
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