In the early 1900s, any American over the age of 65 was considered "old." That's understandable because in those days the average life expectancy of U.S. citizens was 47 years. My how things have changed!
Today we define "old" as somewhere north of 90, and by all indications, the definition of old age is going to keep on rising. According to the U.S. Census Bureau projections, by 2050 at least 400,000 of our citizens will be 100 or older. While this is a welcome development and something most of us never imagined, planning for longevity brings a whole new meaning to the idea of creating an "abundant second half."
For many Americans, living really long lives is a double-edged sword. On one hand, the idea of getting more years with the people we love and more time to do the things we enjoy is fantastic. On the other hand, the longer we live, the more money we'll spend; and the more money we spend, the more money we'll need; and the more money we need, the more significant the demands we'll place on our investment portfolios.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The quality of our "bonus" years will be directly influenced by the strategy each of us co-creates with our financial advisers, the health care decisions we make, the way we manage our finances and the manner in which we live our lives.
Still, as financially demanding as it can be to plan for a long life, we must remember that it is well worth it. Long life is a gift to each individual. We should also keep in mind some of the less obvious but significant rewards of longevity:
The opportunity to contribute to the economy
In a 2013 white paper titled, The Longevity Economy: Generating Economic Growth and New Opportunities for Business, Oxford Economics coined the term "longevity economy." It's defined as the "sum of all economic activity serving the needs of Americans over 50 and including both the products and services they purchase directly and the further economic activity this spending generates." Oxford Economics anticipates that this segment of the population will increase its contributions to economic activity from $4.6 trillion in direct spending to $13.5 trillion in 2032. But that's not all; the over-50 population contributes $100 billion to charity, representing 70% of all individual contributions. The estimate of economic activity and charitable contributions our aging population is expected to make to the economy dispels the myth that an aging population is a drag on social programs and the economy.
The benefit of sharing wisdom
Wisdom—the sum of our values, knowledge, life experiences and the lessons we've learned from our success and failures—is a by-product of living life and one of the most priceless gifts of longevity. Although intangible, wisdom shapes our lives as we age; it influences everything, from the way we conduct ourselves to our philosophy of life and the values we pass on to our children and grandchildren.
Life is a series of trade-offs, the most significant of which is youth for old age. We don't get to choose whether we make that trade-off. But we do get to choose the way we spend our wisdom—the life-lived dividend we earn as we age—and many of us have chosen to invest our wisdom in our co-workers, our communities and our families.
The positive influence on families
In 1989, 109-year-old Augusta Bunge and the six other generations of her family took their place in the Guinness World Records as the family with the most generations alive at the same time. Augusta was 109, her daughter was 89, her granddaughter was 70, her great-grand daughter was 52, her great-great granddaughter was 33 and her great-great-great granddaughter was 15 when she gave birth to Augusta's great-great-great-great grandson that year.
While few of us would even come close to taking the Guinness World Record away from Augusta, many of us currently share the earth with three or more generations of our own families. According to a 2011 National Institute on Aging, report titled, Global Health and Aging, "there is no historical precedent for a majority of middle-age and older adults having living parents."
Of course longevity increases the possibility that at some point younger family members may be called upon to provide or coordinate care for their elders, but support and caring is not a one-way street. Today it is also common for older family members to help their children by running errands and by providing childcare and regular or situational financial support for younger members of their families.
Finally, it's also important to point out that in our increasingly complicated world, there are immeasurable benefits gained when younger generations share a family history and values with their grandparents or great-grandparents.
Longevity is here to stay! And that's great because it's the ultimate win/win/win for individuals, families and our country.
Related Content
-
Cord Cutting Could Help You Save Over $10,000 in 10 YearsHow cutting the cord can save you money and how those savings can grow over time.
-
The '8-Year Rule of Social Security' — A Retirement RuleThe '8-Year Rule of Social Security' holds that it's best to be like Ike — Eisenhower, that is. The five-star General knew a thing or two about good timing.
-
You Were Planning to Retire This Year: Should You Go Ahead?If the economic climate is making you doubt whether you should retire this year, these three questions will help you make up your mind.
-
Are You Owed Money Thanks to the SSFA? You Might Need to Do Something to Get ItThe Social Security Fairness Act removed restrictions on benefits for people with government pensions. If you're one of them, don't leave money on the table. Here's how you can be proactive in claiming what you're due.
-
From Wills to Wishes: An Expert Guide to Your Estate Planning PlaybookConsider supplementing your traditional legal documents with this essential road map to guide your loved ones through the emotional and logistical details that will follow your loss.
-
Your Home + Your IRA = Your Long-Term Care SolutionIf you're worried that long-term care costs will drain your retirement savings, consider a personalized retirement plan that could solve your problem.
-
I'm a Financial Planner: Retirees Should Never Do These Four Things in a RecessionRecessions are scary business, especially for retirees. They can scare even the most prepared folks into making bad moves — like these.
-
A Retirement Planner's Advice for Taking the Guesswork Out of Income PlanningOnce you've saved for retirement, you'll need your nest egg to support you for as many as 30 years. For that, you need a clear income strategy, not guesswork.
-
Why Smart Retirees Are Ditching Traditional Financial PlansFinancial plans based purely on growth, like the 60/40 portfolio, are built for a different era. Today’s retirees need plans based on real-life risks and goals and that feature these four elements.
-
Technology Unleashes the Power of Year-Round Tax-Loss HarvestingTech advancements have made it possible to continuously monitor and rebalance portfolios, allowing for harvesting losses throughout the year rather than just once a year.
