How long will you live? If you knew the answer, it would eliminate one of the most difficult aspects of financial and retirement planning.
This magic number holds the key to a lot of your planning. Your lifespan is used to calculate critical numbers including:
- The total dollar amount you need to save for retirement
- The best age to start drawing on your social security benefits
- How much and what type (if any) life insurance makes sense in your personal planning.
Much of retirement planning hinges on that very number. It goes without saying that the more deliberately you calculate your lifespan, the less uncertainty you will have in your retirement planning. And uncertainty is what keeps you up at night.
Obviously, there are no guarantees - just ask 95-year-old and still going full steam, Betty White - but there are tools to help make your guesses more precise.
The Social Security website has a quick life expectancy calculator that uses just age, gender and life expectancy tables to estimate longevity.
If you want a more personalized number, MetLife Insurance created a useful calculator that uses genetics and personal lifestyle factors.
This Living to 100 calculator from the New England Centenarian Study will not only give you an estimate of your life expectancy but offer personalized suggestions to help extend your life.
Once you have your magic (or not-so-magic) number, it’s important to use it as a conservative estimate. Most certified financial planning experts recommend that you plan for a longer-than-average retirement. Whether it’s adding five years to the age calculation, or planning to live until ninety five, it’s important to plan for longer than you (and the calculators) think you’ll live.