Living longer means that we might witness history in the making, it means that we might get to know our great, great grandchildren, and even have a front row seat to the next century.
All of this is very possible, especially if one reviews credible statistics regarding longevity which states that at the moment life expectancy is increasing at a rate of one and a half days per week; or, that half of all people in the world who turned 80 are still alive.
The longevity ship has already sailed if one considers that globally, there are nearly 400 000 centenarians. This means that globally, on this day, about 1 000 people will celebrate their 100th birthday.
Work and life integration
In South Africa, the average retirement age stands at 60 years. Should one live to reach the age of 100, it means that retirement savings will have to last for at least 40 years. This is savings that were produced over a period of only 35 years if one assumes that a person entered the workforce at age 25. Clearly, this sum does not add up.
In other countries, longevity is already viewed as a risk by governments and countermeasures were put in place. For example, Italy has introduced incentives to keep people working until the age of 70, and Australia plans to increase their official retirement age to 70 years by 2035.
In the USA, a new trend has emerged where baby boomers who are reaching their early seventies are not only working, but increasingly working full-time.
This is especially evident with women. Almost half of women working in their late sixties are employed full-time. Also, women in their mid-sixties can expect to live longer than men because a current 65 year old man’s average life expectancy stands at 83 years while women can expect to live, on average, about three to five years longer.
Avoid the blind spot
The longer we live, the greater our chances are of contracting a critical illness. In fact, the likelihood of being diagnosed with cancer before the age of 65 is one in 10, but this increases to one in two before the age of 85.
Equally worrying is the rapid increase of diseases like dementia. According to the World Health Organisation, the number of people living with dementia worldwide was estimated at 47 million during 2015 and is expected to affect approximately 75 million people in 2030 and reach a staggering 135 million in 2050.
The upside
There is however an upside to all of this because the medical fraternity is reaching new frontiers every day and is gaining control over severe diseases.
Some of the astonishing medical advances that we often read about include the fact that a cure for cancer might be around the corner; gene editing could eradicate numerous diseases, and organ donation might disappear because of 3D printers.
Gaining perspective
Although these advances in longevity and technology appear to be very positive outcomes, one must remember that this could very well be a double edge sword because everything comes at a cost.
Living longer does not necessarily mean that we will live healthier. Living a long life with a disability or critical illness can cause severe financial pressure.
As mentioned earlier, people are working longer, but being unable to work and earn an income due to an illness or disability can become unaffordable over the long term. This is why it has become crucial to consider longevity when compiling a client’s financial plan to provide for a lifetime of financial needs.
This has to include new generation longevity products that provide clients with additional pay-outs, irrespective of their health, for the rest of their lives. Tailored longevity benefits that protect your clients against the risk of outliving their capital will contribute a great deal towards their overall financial wellness.
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