Dipping your toes in the fresh waters of an exotic beach. Enjoying a gorgeous sunset and your favorite drink as you relax on the back patio. Getting lost in a painting because you have all the time in the world to perfect every brushstroke. Spending more time with family and friends. These are the types of things you dream of indulging in when you retire. You don’t picture worrying about how much money you have in the bank or trying...
By Seung Jeonga, Iqbal Owadallya, Steven Habermana & Douglas Wright People's perceptions about their chances of survival are known to deviate from the objective survival probabilites derived statistically from mortality data. This is crucial because it may explain why people save too little, why their retirement plans are inadequate, and why they do not buy financial security products such as life insurance and annuities which could protect them and their family in the event of early death or in old...
By Surya Kolluri, Janet Weiner & Mary Naylor Since 1935, when Social Security set the age to receive full benefits at 65, average life expectancy in the United States has risen by 17 years. This increased longevity has clear implications for financial planning, both in terms of the timing of retirement and the need to plan for a longer period of retirement. But there are less obvious implications as well, in terms of the likelihood and length of time that...
A new government should introduce a range of new policies on retirement, health and social care, to release a potential “longevity dividend” worth half a trillion pounds, as well as deliver a range of social benefits, according to the International Longevity Centre (ILC). Policies outlined in its new white paper include an auto-enrolment (AE) savings scheme to run alongside AE pensions, auto-escalation of minimum AE contributions, and ideas to help self-employed and gig economy workers save for retirement. Other ideas floated...
BY 2030, ONE in four Californians will be 60 years or older. By 2060, the percent of Californians in the 60+ age group will have increased three times faster than the total population. People are living longer than ever. Worldwide, the average life expectancy of a newborn has more than doubled since 1900, from 32 years to 71 years. Half of 5-year-olds in the United States today will likely live for 100 years or more. The Stanford Center on Longevity (SCL)’s mission is to...
By Seung Yeon Jeong, Iqbal Owadally, Steven Haberman & Douglas Wright Evidence from panel surveys of households, collected over several years and in different countries, shows that people’s perception about their remaining lifetime deviates from actuarial data. This has consequences for consumption, savings and investment over an individual’s financial life cycle, and in particular for retirement planning and the purchase of annuities. We use data from the U.S. Survey of Consumer Finances to estimate subjective survival probabilities at different ages....
People who don’t plan financially for their future have an increased risk of dying prematurely, according to new University of Colorado Boulder research. The research found that procrastinating financial planning for the future isn’t only bad for the wallet, it can affect life expectancy. The study analyzed data from thousands of older adults living in the U.S. and England, according to a release. The two groups were asked about their planning horizons on spending and saving. The researchers later checked government...
The world’s massive human population is leveling off. Most projections show we’ll hit peak humanity in the 21st century, as people choose to have smaller families and women gain power over their own reproduction. This is great news for the future of our species. And yet alarms are sounding. While environmentalists have long warned of a planet with too many people, now some economists are warning of a future with too few. For example, economist Dean Spears from the University of...
Fewer than one in four age 50+ workers and retirees are very confident they will be able to maintain a comfortable lifestyle throughout their retirement (17%, 23%, respectively), according to Life in Retirement: Pre-Retiree Expectations and Retiree Realities, a new survey report released by nonprofit Transamerica Center for Retirement Studies® (TCRS) in collaboration with Transamerica Institute®. "Retirement brings freedom and time for pursuing personal passions. Our research finds that retirees are happy, purposeful, and have a positive view of aging. However, many...
By Abigail Hurwitz, Olivia S. Mitchell & Orly Sade Inaccurate perceptions regarding life expectancy can lead to suboptimal financial decisions with long-term consequences, including undersaving prior to retirement, and overspending during retirement. As prior research suggests that Covid-19 mortality has disproportionately harmed those with low incomes, African Americans, and Hispanics in the United States, we seek to determine whether subjective survival perceptions among these groups changed in a manner consistent with observed outcomes. We fielded two online experimental surveys of...
