“I want my last check to bounce on the day I drop dead!” said a gentleman to me several years ago.
I thought it was funny at the time and I’ve referenced that statement many times since.
The single biggest concern investors face when considering retirement planning is the goal to have enough money to support you for as long as you live.
The obvious question is… “How long are you gonna live?”
If we only knew, it would make so many of the tough financial decisions older Americans face easier.
Obviously, none of us has a crystal ball, but an increasing number of sophisticated online Life Expectancy Calculators are helping folks to better quantify their probabilities of living to a certain number of years in retirement.
This from a recent article on Kiplinger’s…
Life-span predictions may sound like the stuff of tarot cards and palm readers. But an increasingly sophisticated set of online tools promise to help individuals gain a sense of how long they might live — and retirees, health care providers and financial planners are paying attention.
The tools are gaining popularity as older adults face a host of difficult questions that revolve around life expectancy: Should you start taking Social Security at age 62 or wait and collect a bigger check at 70? Do the longer-term benefits of various types of cancer screening outweigh the immediate risks of these procedures? Given your current rate of portfolio withdrawals, do you risk outliving your nest egg?
The more complex versions ask dozens of questions about your eating habits, how you handle stress, and even how many friends you’ve made in the past year. Some will spit out an exact life-span estimate and offer suggestions on ways to extend it, while others will show a range of probable life spans or the risk that you’ll die within, say, five years.
A List of Online Life Expectancy Calculators
1. LivingTo100.com = created and maintained by Dr. Thomas Perls, associate professor of medicine at Boston University School of Medicine. Aimed at individuals and asks dozens of questions about everything from your family’s longevity to your consumption of red meat. The calculator’s goal, Perls says, “is to be an educational tool and to teach people that their day-to-day health-related behaviors can have a dramatic impact not just on how long they live but how well they live.”
2. ePrognosis.org = a site that helps health care providers get a better handle on those risk-benefit tradeoffs. The site offers 16 different calculators that estimate mortality risk over specific time periods for various groups of older adults, including those who are hospitalized, in nursing homes or living at home. Although the tools are intended for health care providers, you can use them by clicking a button stating that you’re a health care professional.
3. gosset.wharton.upenn.edu/~foster/mortality = Rather than focusing on a single number, some tools offer users probabilities that they will reach a range of ages. This calculator tells a healthy 65-year-old woman that she is expected to live to 88 years old and has a 50% chance of dying between 81 and 95.5 years old. A longer calculator available at the same site shows users how many years they might add to life expectancy by changing their behavior.
4. www.lifespancalc.com = Financial-services companies offering annuities, long-term-care insurance and other products are spotting opportunity in the calculators. Northwestern Mutual’s calculator found here is more educational than selling anything.
Using these tools in your own privacy can help you get a better handle on the potential time horizon you should be considering when making financial decisions.
Focusing on this longer time horizon is critical to help you weather the short term emotional swings in any investment game plan.
As always, if you need investment help or have important financial questions, please feel free to let us know and we’ll be happy to answer your question.