That’s what most of the investors answer when they are asked – “How long are you going to live?”
Truly speaking, no one knows how long will you live!. We may die at 60, 70,80, and 90,100 or may be 100+. Who knows?
Today, we are trying to answer this question from retirement planning perspective. When you plan for your retirement corpus, it depends heavily on how long you are going to live!. If you live for a short period, you need less wealth. If you are going to live for a very very long time, you are going to need a very large corpus.
Your answer to “How long will you live after retirement?” will also vary depending on how happy are you with life overall currently. If you are stuck in your job, where you feel frustrated and also have not been able to reach some milestones in life, your answer will show the pessimism and you might say “75 yrs” is enough for me”
However if you are full of life, very happy right now, in a great health and have been doing great in your financial life, you might say “I would love to live till 90 or 95, Life is so beautiful”
Coming to the main question we are trying to answer today, we want to investigate or rather get enough clues on how long we can expect to live in retirement. Finding a good enough answer is critical for every one of us. The biggest retirement worry most of the people (who are already retired) is “Outliving their money”. Just think of a situation where a person has planned for just 20 yrs. of retirement (retired at 60 and expects to die at 80), but he has already reached 78 yrs. of age and his money is almost finished.
What kind of mental trauma he/she has to go through?
We all want to make sure that it does not happen to us.
We all want to make sure that in our retirement life, we have enough money, freedom to withdraw enough money for our expenses and have a decent margin in case anything goes wrong, so that you don’t have to depend too much financially on others.
Let’s start with the basic question – “What is the average life expectancy in India right now in 2020?”
The official answer is around 69.73 in India at birth. For simplicity sake we will take life expectancy as 70 yrs. The life expectancy in India is continuously increasing every year from last many decades (a lot of people have this myth that it’s decreasing)
It simply means that one an average when a child takes birth, He/She is expected to live up to 70 yrs. of age.
So this 70 yrs. is “Average” – which includes
So, you now understand that “average” is kind of a fraud number. It gives some idea to you about something, but does not reveal enough to take decision.
Let’s change the track a bit. I want to now talk a bit about Men and Women life expectancy.
Another thing you should know is that women in general live longer than men all over the world. In India also its true, and its truer for couples. You will often see men dying before their wives for simple reason that men generally have higher age compared to women, and men are exposed to more risks like accidents etc. because men mostly drive, get involved into those tasks which often have danger of life.
Decades ago, people died because of illnesses and diseases/inflections which look very normal today. The medicine and vaccines are available today which were not available few years/decades back (in future people will also talk like this for coronavirus). Critical diseases (like cancer, heart diseases, stroke, etc) rate has decreased from 250 to 152 per ten thousand in last 20 years or so.
Another angle to the same conversation is that our country is making progress every year and we are on our journey towards becoming a developed nation. India in 2040-50 (When I will be retired) be a different place than today (like its different than 1990)
As a nation develops we have better access to everything. We have more money, we have better healthcare system, we have better roads and infrastructure (imagine less accidents).
If you compare yourself to your parents, you will agree that you have much better access to better housing, quality food (ok this is controversial), quality entertainment, quality travel, quality healthcare, quality roads and infrastructure. They might not have been able to afford a good hospital, but you can!.
All these together contribute to a higher life expectancy.
Conclusion I would like to conclude and sum up this article now with some points. Here they are
So if you are 30-45 yrs. old person reading this article, you need to be clear on this that once you get older, you will have much higher chances of living longer compared to our parents or much older generation. So plan thinking of the longest you can live, not the “average age” for yourself, your spouse and of course for Next generation.
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Stating From 2000 SIP to creating corpus of 300 times monthly expenditure
You don’t need wealth to create wealth. Just need action in the right direction