Interesting point about retirement today (retirees, years, payments, benefit)
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I have always understood what you are taling about above. However, medical advances also apply to old people, so I'm not sure the longevity difference between a 65-year-old now and in 1930 is as minimal as you say it is, although I agree it's a lot smaller than the averages from birth would suggest. I don't have figures or data at hand for that.
Medical advances apply much more to infants and young children than to adults or old people. There have been some life-saving advances, but not nearly as much as we are led to think. And even though pharmaceuticals are now a huge business, their effect on health and longevity is probably quite small. Most of the drugs cause damage while, supposedly, improving health. And many of them are relatively new, so we don't know their long-term effects.
And yes, as you said, the obesity epidemic, caused by the increasingly inactive American lifestyle and processed food, is likely to cause a great increase in illness and early death.
Notice that the people who advocate raising the Social Security age are usually people who are rich and will never need Social Security.
I have always understood what you are taling about above. However, medical advances also apply to old people, so I'm not sure the longevity difference between a 65-year-old now and in 1930 is as minimal as you say it is, although I agree it's a lot smaller than the averages from birth would suggest. I don't have figures or data at hand for that.
But what I really wanted to post here is the interesting speculation that we are on the cusp of a reversal in adult longevity because of the greater prevalence of obesity, diabetes, and lack of exercise. The thinking is that these changes will be stronger than the influence of the lower smoking rates in the other direction. Type II diabetes has been increasingly showing up in adolescents. The speculation I am talking about is by medical epidemiologists, so it would be informed speculation. We think science is the answer to everything, but good exercise and eating habits may be stronger than any science in keeping us healthy.
If anyone has predicted a reversal in adult longevity, I'd like to see it. I believe the greatest threat is not an increase in mortality, but an increase in morbidity. An increase in morbidity does not necessarily result in premature death.
Which raises another issue rarely acknowledged by those seeking to raise the retirement age. Even though Americans are (in general) living longer, I have not seen any data that suggests the onset of age related disorders (decreased cognitive abilities, osteoarthritis, etc.) has also been delayed.
Hmmm, no. The figures are cohort life expectancy. In this scenario, the cohort consists of 65 year olds. Might be a little more than 5 years - but, if so, not by much.
I will let you folks argue about what this means but is part of one of the links presented in the thread. Life Expectancy for Social Security
Quote:
As Table 1 indicates, the average life expectancy at age 65 (i.e., the number of years a person could be expected to receive unreduced Social Security retirement benefits) has increased a modest 5 years (on average) since 1940. So, for example, men attaining 65 in 1990 can expect to live for 15.3 years compared to 12.7 years for men attaining 65 back in 1940.
Don't respond to me or ask me to explain I just saw the words and they seem to have some relevance to the discussion. If not I apologize for posting it.
I think many people living on pensions will be hurting as well. I know my state (NJ) has proposed doing away with COLA increases. I'm sure this will happen in many other states as well.
My husband was helping his mother throw away old papers last week, and the difference in her pension at retirement and what it is now(she's 91 and still going strong) was staggering.
For retirees that don't have a lot of savings and live long, they will be in a world of hurt.
If you were planning on living to the max based on your pension and SS with no room for inflation you were probably going to be in trouble anyway. Many pensions had a cap on their COLA and if inflation exceeded it. You do have greater latitude over some expenses in retirement. The killer working against you is health care. However there has been adequate warning that you need to have at least 250K per couple set aside for health care. Also if you stagger taking SS in stages after taking your pension it becomes a natural cost of living increase. We were fortunate in being able to retire at 59 1/2 with our pensions and investments as a cushion if needed. Wife SS at 62, me spousal at 66 and me with my benefits at 70. That gives us a bump in income far in excess of any inflation through age 70 at which mandatory tax deffered draw downs begin. If nothing else they become a further hedge agains inflation plusssssssssssssssssssss. People without pensions have to know how to grow their money in retirement via savings and investments so their nest egg lasts. Folks with pensions have a big advantage as they have that. Folks need to realize that whatever you think you have your retirement better have the ability to grow money in excess of inflation. What I tell folks is that before you retire on a pension and SS you need to have 125% of yourinitial pension and SS payout invested and let that investment grow at a rate that equals or excees inflation. That ROI becomes your inflation COLA self developed and no government can take it. The 125% helps to account for taxes on your investment drawdown. In addition you need to have your pool of money for health care overage either invested or have a significant difference between income and anticipated expenses, so you have an unexpected health care cushion that you can save while retired. If you want to really be ready be prepared for a 20% reduction in promised pension and perhaps SS benefits. Perhaps not needed for SS if above a certain age but if you have a pension from Illiniois or a couple of other states you might need it. Just about all retirement planning advice tells you to plan to age 94 at a minimum.
i think the more important aspect of the show is that going forward what the retirement calculators show may be very wrong. they are based on the high interest rates and rising bond prices we had in the 30 year old bond bull market.
now there is no uplift from bonds or much cash generation and that throws a whole new light on retirement planning if you need to live off your own nest egg.just to add to the confusion is that study that says maybe we need a lot less then these calculators say. only problem is what if the calculators are correct and it turns out you need more.
Last edited by mathjak107; 03-06-2011 at 02:44 AM..
If anyone has predicted a reversal in adult longevity, I'd like to see it. I believe the greatest threat is not an increase in mortality, but an increase in morbidity. An increase in morbidity does not necessarily result in premature death.
Which raises another issue rarely acknowledged by those seeking to raise the retirement age. Even though Americans are (in general) living longer, I have not seen any data that suggests the onset of age related disorders (decreased cognitive abilities, osteoarthritis, etc.) has also been delayed.
Just ponder the following thoughts and their impact on life expectancy. Not you but all of us.
Decreases in Medicare benefits at the same time health cost will be rising
Fewer people with pensions and the ability to secure their financial future without running out of money
Demographic changes in the United States with sub groups with shorter life expectancies becoming a greater percentage of the population thus impacting the average life expectancy.
basically we are on the yoyo plan more and more (your on your own).
i predict more and more we will gravitate more and more towards insurance backed products and less and less on ourselves especially early on in retirement when a down market can creat devastation to a portfolio before it had time to run a few market cycles and grow.
low cost,low fee insurance based products are coming to market that are geared for covering your income for any length of time right up to lifetime . they even have plans for covering you the first 5 years of retirement when the most damage can be done. its all the dead people that give them the ability to this and we dont have that advantage.
its funny we all insure our homes and our cars against issues we will never collect on and the odds of your home burning down are less then 1 %... on the other hand the odds of running out of money over a lifetime are starting out 10x greater as a best case and get worse from there yet very few look to insure that aspect of there lives.
Last edited by mathjak107; 03-06-2011 at 06:06 AM..
basically we are on the yoyo plan more and more (your on your own).
i predict more and more we will gravitate more and more towards insurance backed products and less and less on ourselves especially early on in retirement when a down market can creat devastation to a portfolio before it had time to run a few market cycles and grow.
low cost,low fee insurance based products are coming to market that are geared for covering your income for any length of time right up to lifetime . they even have plans for covering you the first 5 years of retirement when the most damage can be done. its all the dead people that give them the ability to this and we dont have that advantage.
its funny we all insure our homes and our cars against issues we will never collect on and the odds of your home burning down are less then 1 %... on the other hand the odds of running out of money over a lifetime are starting out 10x greater as a best case and get worse from there yet very few look to insure that aspect of there lives.
I think immediate annuities are good for people without heirs (like me). We can get a much higher income from our savings because of the risk pool than we could from investments. It has to be a very reliable insurance company though. And I want to buy annuities from several different companies, not just one.
im a big fan of them too... im planning about 25% immeadiate annuities and 75% my portfolio. it actually increases the amount we may end up leaving heirs as it reduces the amount we have to pull from our own nest egg to get the amount we need to live on. once we get back in payments what my wife and i paid in its all gravey.odds are one of us will live long enough to score on it. if not then its a moot point anyway.
another interesting product is longevity insurance. the policies are very cheap and kick in if you make it to an age where you never thought you would make it. its much easier to plan a portfolio to age 80 or 85 then have a policy kick in to provide more income just in case you over spent in the earlier years then to guess how long you or your spouse will live
Last edited by mathjak107; 03-06-2011 at 08:49 AM..
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