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What is Longevity Risk?

Longevity risk is the danger that you will outlive your money – and it is becoming a greater threat to a healthy retirement with every year that goes by. Why is longevity a threat? Because we are living longer than ever before. Since the turn of the last century, life expectancy beyond age 65 has grown from 11 to almost 20 years for men; and from 12 to 22 years for women. Under current projections, individuals nearing retirement should prepare for the possibility of living another 20 years – and conceivably much longer. That requires not only a significant amount of savings, but also an investment strategy that accounts for a retirement that could compare to a working career in length. It’s also important to understand how your needs will change over time and the funding implications of that evolution. For example, traditional retirement goals, such as travel, may need to give way to practical considerations such as funding of mobility devices and long-term care. To fully account for the impact of longevity, consider meeting with me to review these risks and your current financial plan to make sure your retirement needs will be met.