Longevity Risk Isn’t Just About Money—It’s About How You Live
We’re all living longer. Yay!
That trend will continue. Yay!
Yet, while the numbers are hard to define, there are some 6 to 8 million adults 65 and over who live in poverty. An increasing number of people living into their 80s and 90s are at serious danger of depleting their finances.
There’s a risk in Retirement Planning that doesn’t get nearly enough attention: longevity risk—the possibility that you’ll live longer than expected and outlive your savings. It sounds like a good problem, right? Who wouldn’t want to live a long life? But what happens if you hit 92 with the energy of a 72-year-old—and the bank balance of someone who only planned to live to 82?
In financial circles, longevity risk is mostly a numbers game. Advisors run Monte Carlo simulations and tweak withdrawal strategies to stretch portfolios over an unknown future. That’s critical work. But here’s where the conversation often stops short: how you live affects how long you live—and that has real financial implications.
As I type this, I can think of multiple situations (some close Family members) who may not have the money to sustain their current Lifestyle
The old rule of thumb used to be that planning until age 85 was sufficient. But that model is outdated. Today, more retirees are living into their 90s—and even past 100. According to the Social Security Administration, one in three 65-year-olds today will live past age 90. One in seven will live past 95. And those are just averages.
Healthy, engaged people tend to live longer. That includes the people who Exercise, eat reasonably well, have strong social networks, and stay mentally active. If you’re reading this article, that might be you.
However, medical advances are extending the lifespans of those who don’t focus on personal care. In these cases, Health expenditures and reduce the portfolio even quicker.
So, the more successfully you navigate the non-financial aspects of Retirement—health, purpose, connection—the longer you might live. And the longer you live, the more financial strain you may face.
That’s why retirement planning needs to expand beyond the spreadsheet.
We need to ask questions like:
It’s time to flip the script. Instead of hoping you don’t live too long, start planning as if you will—and do everything you can to make those years worth living.
The Motivation Time Analysis (MTA) asks you to evaluate how well you manage through personal, planning and professional aspects to remain positively motivated.
Here are some non-financial strategies that can help you manage longevity risk—by both extending your vitality and controlling your costs:
1. Live Actively, Not Expensively
You don’t need to fill your retirement with cruises and country clubs. In fact, walking, biking, Gardening, and Volunteering are not only good for your wallet—they’re also good for your health and sense of purpose. My wife and I really challenge ourselves with the budget we plan to have in retirement. Frugal living is a joyful pursuit.
2. Create a Social Safety Net
I have spoken of this often, isolation is both a longevity and a financial risk. Build your social circles before you retire. These connections can help you stay emotionally strong and reduce the need for professional (and costly) care later.
3. Downsize on Your Terms
The best time to rethink your housing is when you’re healthy, not when you’re forced into a decision. Smart Downsizing can free up cash and reduce future costs like maintenance, utilities, and property taxes—without sacrificing lifestyle. Keep trying to simplify while not sacrificing quality of life.
4. Stay Partially Engaged in Work or Passion Projects
A small side hustle, consulting gig, or creative pursuit can serve multiple purposes: mental stimulation, purpose, and supplemental income. That extra income could be the difference between a comfortable and a constrained life in your 80s and 90s. Work and retirement can mix.
It’s not morbid to prepare for a long life. It’s responsible. Especially if you want to maintain dignity, independence, and choices throughout retirement.
Planning for longevity isn’t about being pessimistic. It’s about being optimistic and strategic. It’s betting on yourself—and ensuring you have the financial and lifestyle foundation to make the most of every year you get.
Think of yourself at 100. Then think of what you need to live a quality life at 100. If you can’t answer the financial question, see your financial advisor. If you wonder about how you will use your time, the Retirement Time Management (RTA) assessment can help.
David Buck is the author of the book The Time-Optimized Life, coauthor of The Retirement Collective, and owner of Kairos (Time) Management Solutions, LLC. Learn how to apply the concepts of proactively planning and using your time. Take the Time Management Analysis (TMA), the Retirement Time Analysis (RTA), or all the other free resources offered to help bring more quality time into your life.
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