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How Long Do You Expect to Live?

Longevity Risk is one of the biggest risks we manage when doing retirement income planning.  This is because one of the top concerns of retirees is running out of money while they’re still alive.  

Your longevity assumption can play a huge role in retirement income decisions, such as: 

  • Pension benefits – do you take the lump sum option or take the lifetime income payments? 
  • When to claim your Social Security 
  • Should you use a portion of your assets to buy additional guaranteed lifetime income? 
  • How much should you withdraw from your portfolio each year? 
  • How should your assets be allocated in retirement? 

And those are just a few. We can probably come up with a dozen or so more. 

What’s interesting here is that the Stanford Center on Longevity tells us that most pre-retirees tend to underestimate average life expectancies – sometimes as much as 43%. That’s a big margin of error on something that really needs to be as accurate as possible – even if we can’t know exactly what the true answer will be. 

So, with that in mind, how long do you (and your spouse, if you’re married) expect to live? While thinking about that question, consider this: 

The Social Security Administration says the average life expectancy for a 65-year-old male is around age 84 and the average for a 65-year-old female is approximately age 87.  If you’re already age 65, that should have figured into your age estimation. 

And if you’re married, the Society of Actuaries says a 65-year-old couple has an 83% chance that at least one of them will live to age 85; a 62% chance that one will live to age 90; and a 33% chance that at least one of them will live to age 95. But how many people project that they will actually live that long? Not many, which is why most people tend to underestimate just how long they’ll live.  

Of course, these are just average statistics, and your own longevity will also depend on many other factors. The point here is that it’s important to consider what may happen if you wind up living longer – or a lot longer – than you thought you would. Are you prepared? Do you have a strategy in place that aims to account for all of that? Remember, we can’t always control how long we’ll live, but we can control the assumptions we use in our retirement income planning.  

At Lucia Capital Group, we understand that no one wants to run out of money in retirement, and we can help you with each of the retirement income planning decisions mentioned earlier. Just give us a call to schedule your free, retirement income review. 

Important Information:

The information provided should not be considered specific tax, legal, or investment advice and is not specific to any individual’s personal circumstances. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

Different types of investments and/or investment strategies involve varying levels of risk, and there can be no assurance that any specific investment or investment strategy (including the investments purchased and/or investment strategies devised by Lucia Capital Group (“LCG”)) will be either suitable or profitable for a client's or prospective client's portfolio, thus, investments may result in a loss of principal. Accordingly, no client or prospective client should assume that the presentation (or any component thereof) serves as the receipt of, or a substitute for, personalized advice from LCG or from any other investment professional.

You should always seek counsel of the appropriate advisor prior to making any investment decision. All investments are subject to risk including the loss of principal. This material was gathered from sources believed to be reliable, however, its accuracy cannot be guaranteed.

The information provided is based on current laws, which are subject to change at any time. Lucia Capital Group is not affiliated with or endorsed by the Social Security Administration or any government agency.

Social Security rules can be complex. For more information about Social Security benefits, visit the SSA website at, or call (800) 772-1213 to speak with an SSA representative.

Rick Plum is a registered representative with, and securities and advisory services offered through LPL Financial, a registered investment advisor and member FINRA/SIPC. The investment professionals are affiliated with LPL Financial and are conducting business using the name Lucia Capital Group, a separate entity from LPL Financial.

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