What is your Financial Life Expectancy

Life expectancyPlanning our finances would be easy if we all knew how long we would live. Many people base their estimates on their family’s Life expectancy. This can be a good indicator as long as your parents died of natural causes and lived a similar life to your own. However, we now know that this comparison is not always accurate for predicting Life expectancy.

With improvements in food, medical treatment, exercise, and knowledge about how to take care of ourselves, we are all living longer. The question now is, what is your real life expectancy, and how will you plan for it financially, especially if you life longer than your parents?

Life Expectancy and Financial Impacts

The first step is to figure out your life expectancy based on genetics. Let’s assume both parents lived to age 75. It could be an easy assumption that their children will also live until around age 75.

With the help of a financial advisor, you could use this age as a guide to calculate how much money to take out of your savings so that it will last until your demise. This is a first step only. You may find you have to work a bit longer to achieve the lifestyle you want while in retirement, or you may already have sufficient savings.

Now assume you will live 10 years longer. Better food, better medical care, and a healthier lifestyle could contribute to living 10 or even 20 years longer than your relatives!

Adjust your financial plan for a longer Life. Will you have sufficient funds? Will you need to work longer and save more? You may need to cut back on expenses to ensure a comfortable lifestyle as you live longer.

Do your analysis now and make informed decisions to ensure you have sufficient funds to meet your extended life expectancy!

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