According to new research, people aged 50 and over on average think they will live until around age 80, whether male or female.
The good news is, according to the ONS life expectancy calculator, a male aged 50, will, on average live to age 84, while a woman aged 50 will live on average to age 87.
This gap in expectation and reality creates additional pressures on retirement planning and a different type of retirement gap, according to Canada Life, especially given the choices the majority of people currently make around their plans, choosing unsecure retirement income over any type of guarantee.
Nick Flynn, retirement income director at Canada Life explains how “longevity risk is the one known unknown in retirement planning, but if people are underestimating their life expectancy, this opens up a new retirement gap”. He added:
“Men and women thought they would live to age 80, despite the stats showing on average men will live for a further four years and women a further seven years. One in four women aged 50 today can expect to enjoy retirement into their 90s, living till age 95.
Talking about and thinking about your own mortality at the best of times is difficult, but not having these conversations will leave you open to falling short when it comes to your retirement income. Annuities are the only 100% bet against outliving your pension, and with the significant improvement in rates witnessed over the past 18-months, deserve more than a secondary glance.
A professional financial adviser is best equipped to talk you through the various options, to ensure your plans remain on track throughout the course of your retirement journey.”