Living longer is becoming the new norm in America, according to a new report. But with those added years comes extra peril for your retirement portfolio. Let’s take a look.
A Common Goal
Have you ever thought about living to 100? Well, you’re not alone – it turns out a lot of us are thinking about it these days.
Understanding Longevity
Over 50% of Americans want to reach that 100-year milestone, according to data gathered by financial services company Corebridge Financial.
Financial Considerations
But with longer lives come some big financial questions. That’s where the recent report called “Funding Longer Lives” comes in.
It has some helpful tips and insights to help people ensure they’re ready for the long haul.
Corebridge Financial Survey
The report draws from data collected in the 2023 Corebridge Financial Survey on Longevity, which revealed Americans’ aspirations, concerns, and priorities regarding longevity, work, and retirement.
Data Insights
According to the survey, 54% of people’s goal is to hit 100, with GenZers the most set on it – 63% of them want to hit 100.
But it’s not just about reaching that old age; it’s about what we can do with all that extra time.
Maximizing the Extra Years
So, what would you do with all those bonus years? According to the report, over 70% want to spend time with loved ones and try new things – makes sense, right?
Embracing Change
That’s not all we’re concerned about, though – 60% of respondents are excited about the prospect of “Witnessing new discoveries.”
It’s all about making the most of our time, no matter how old we get.
Top Worries for Longer Lives
Of course, with longer lives come some worries. Health problems and money issues are at the top of many of our minds.
Nobody wants to be sick or broke, especially when they’re older.
Health Concerns
Many respondents were worried about facing serious health problems, outliving their savings, and becoming a burden on their families.
Financial Anxiety
And according to the data, most of us aren’t too confident about our finances, especially when it comes to retirement.
Retirement Confidence
Confidence in managing retirement savings and ensuring a steady income throughout retirement was low – particularly among GenXers.
Fear of Running Out
Over 66% of people are more worried that they’ll run out of money than dying – a record high for the survey.
72% of GenXers are worried about this, indicating they’re struggling with financial security.
Demand for Guaranteed Income
There’s also a growing demand for guaranteed lifetime income, with 92% of people surveyed indicating they want to guarantee an income stream before retiring.
Protected Income
Protected income for life in retirement has become more important for 62% of people in the last year.
It’s tough to feel sure about the future, especially with bills to pay and unexpected expenses popping up.
Future Population Trends
According to data from Pew Research, the population of people aged over 100 is forecast to quadruple in the next 30 years.
Currently, there are around 101,000 people over 100 years old in the U.S., but figures estimate that by 2054, around 422,000 Americans will be aged over 100.
Challenges and Opportunities
This has prompted fears from many experts about people draining their retirement coffers with years left on the clock.
Adjusting for Longer Lifespans
While many people now retire at 65 with around $250,000, statistics indicate that they’ll need almost double that to hit new life expectancy figures.
An extra ten years of life expectancy means an extra $200,000, and that figure will hit almost $1 million if they live to over 100.
Financial Preparedness
But what can we do about it? Well, there are some steps we can take to feel more in control.
Planning for the Future
First off, we can talk to our bosses about retirement plans and see what options are out there. It’s also never too early to start saving and investing – every little bit helps.
Getting financial help from an expert will make a big difference, and it’s important to talk to your family about your plans and worries. Having support when times get tough can be invaluable.
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The post Living to 100 Years Old – But How Are We Going to Pay for It first appeared on From Frugal to Free.
Featured Image Credit: Shutterstock / Jacob Lund.
The content of this article is for informational purposes only and does not constitute or replace professional financial advice.
