How many years do you factor for retirement?

B0bbyEwing

Trying to take advantage of a current situation and get a grip on our financials. I was just reading some threads on here to see what's going on in the MSE world & a thought came to me.

I was just curious as to how long you guys factor in for retirement. There must surely be a bit of a range rather than a universally accepted figure I would imagine? To put my words bluntly - how long do you think you have left after your retirement age before you drop dead? Also to take the curiosity further, how do you come to this figure?

Knowing my family on both sides & having done my family tree also, if their death ages are anything to go by then I actually wont have a long retirement and depending when I'm able to retire, I may not have a retirement at all. I know on my dad's side when he died at 68 which was around the time we were getting in to family trees, he had only known of 1 person on his side that had made it to their 70s. 

Statistically speaking, I'd say there wont be many of us reading this who will hit 30+ years of retirement. Obviously depends on various - how late you retire, how early you're lucky enough to retire, how long you live of course.

Some people call it morbid. That's just one angle of looking at the situation. While these people call it morbid, I call it realistic. I generally find that most people who refer to it as morbid are those who don't want to talk about the fact that one day we all wont be here. It's unavoidable though & I don't mind talking about it.

So how do you come to your number? Be it in terms of an actual £GBP number, or an age number (& then work your £GBP off that)?




Oh and yes before anyone points it out, I'm also aware how living a modest retirement vs a sailing round the world every year sipping on the finest champagne money can buy will also impact the amount you'll need.

Brie

finger in the air???

I've always taken after my mom, looks, health issues, and she's still living at home at 93 albeit with help.  Got a fair selection of her marbles and still has the determination to drive....if anyone was silly enough to leave the keys where she could find them.  

OH lost his dad at 92 and his mom is on her way out at 96 - which is young for her family.  Then again - when the OH's dad retired at 60 (as you could in those days) he realised he needed to keep fit and was doing a fair bit of walking every day.  As well as eating very well, having regular tipples and smoking cigars.  OH doesn't walk much any more, almost never drinks but eats well and smokes, and has diabetes like his maternal grandmother.  

So I expect to out last him even though he's younger.  

I'm still trying to figure out how to afford to live that long.

labp04

If a rough'ish idea helps, maybe try this Life expectancy calculator - Office for National Statistics (ons.gov.uk)

DoublePolaroid

It’s a mistake to look at family history and draw conclusions about your life expectancy unless serious, hereditary illnesses are present. 

The current generation on the cusp of retirement have on average a longer life expectancy than their parents had, due to a variety of factors including but not limited to better medical treatment - especially of cardiovascular disease and its risk factors - and significantly reduced smoking rates. 

In the absence of a known life limiting health condition or relevant family history, this calculator would be as good a place as any to start from in terms of planning for retirement. 

dunstonh

Generally, half will make 94, and 10% will make 97.    Those ages will change based on date of birth but they are a good yardstick.

DE_612183

I work on the basis of regular income - from the point when both me and the mrs are 67 we'll get 2 state pensions and about 3 private pensions - from all of that I get a figure of "X" income per month.

If that's enough that's fine, as the pensions will go up over time anyway.

DullGreyGuy

The ONS tool is very basic as it only consider age and gender... there are distinct difference between blue collar workers and white collar... North of England and South East etc.

The ONS tool says I've an expected age of 84 but a 25% chance of making it for another decade beyond that and 10% chance of another 15 years beyond that. Based on location etc in theory the numbers should be a little higher.

biscan25

I don't mind the morbidity, it's my job.

So if you want a simple answer, if I was retiring at 65 today as an averagely fit individual with a decent amount of wealth, I'd budget living to 87/89 depending on gender based on occupational pension scheme mortality tables, and some reasonable projections.

If you had an average amount of wealth, in general you won't live as long, so might say 85/87 for the average English person.

In reality there's a huge amount of variability in longevity, so one should in theory budget for a higher estimate, and take into account their own health, bearing in mind that people tend to underestimate their life expectancy. If you smoke you'll need much less cash too!

In terms of £ amounts, utility of wealth diminishes as you get older, so one might actually plan to run out of money, in particular if they have other assets they can crystallise like a house. You cannot take anything with you after all, and if you run out of money, the state will probably come to the rescue for your care.

Some benevolent souls might care about their descendants, and not mind leaving an inheritance, so they might draw less from their pension to make sure they don't run out.

JGB1955

I retired just before my 59th birthday. I had enough money to bridge the gap between receiving both my Civil Service and Local Government pensions at age 60 and then, going forward, until State Pension arrived at age 66.  Because of my own lifestyle choices (no excuses) I didn't see myself actually reaching SP age and, rather reluctantly, topped up my contributions to reach close to the full amount.  18 months on, each year now feels like a bonus.  I'm far better off financially than I ever was in the past 35 years and look forward to enjoying the 'present' as long as possible.

enthusiasticsaver

My Dad died early at 62 which was a big reason for us taking early retirement at 58.  We forecasted our figures up to the age of 80 focusing on the biggest withdrawals in the early years.  Our IFA forecasted up to the age of 99 for both of us showing that we could afford to  draw at least £20k a year in addition to our  DB pensions.  So far we have not needed to.  I think you can take genetics into it but sometimes there are no guarantees.  My DHs mum and dad were both well into their 80s when they died.  My DH at 63 was diagnosed with a critical heart condition and given less than 4 years to live unless he had open heart surgery.  He had the surgery and thankfully is fine now but had he not persisted in telling the medics something was wrong I dare not think what would have happened. 

Albermarle

dunstonh said:

Generally, half will make 94, and 10% will make 97.    Those ages will change based on date of birth but they are a good yardstick.

This does not really match with the figures mentioned in other posts/ONS calculator , where for example an average 65year will last about 20/22 years ??