'They never expected to live this long' — and now a 30-year retirement threatens to drain their savings

Clay Halton

5 min read

Living into your 90s, or even past 100, used to feel like an exception. Now, it’s something for which more Americans are having to plan.

For many families, that realization hits late. As one retiree put it to The New York Times, her parents “never expected to live this long,” and now they face the possibility of outlasting their savings. (1) It’s a sentiment financial planners say they’re hearing more often.

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The numbers back it up. A 65-year-old today can expect to live well into their 80s on average, and many will live much longer. (2)

For couples, the odds stretch even longer; there’s roughly a coin-flip chance that at least one partner will live into their 90s. (3) Some projections show even higher probabilities depending on health and lifestyle, with many couples likely to see one spouse reach their mid-90s. (4)

That longevity is a success story. But financially, it changes everything.

A retirement that once lasted 15 or 20 years can now stretch past three decades — and that means funding a much longer, more unpredictable future. Add in rising healthcare costs, inflation and uncertainty around programs like that of the Social Security Administration, and the risk becomes clear: running out of money while you’re still alive.

The math of a longer life is reshaping retirement

At age 65, Americans today have nearly 20 additional years of life expectancy, on average — and that’s just the midpoint, not the ceiling. (5) Many retirees will live far longer, which means retirement plans based on average outcomes can fall short.

That’s one reason traditional rules of thumb like the four percent withdrawal rule are under more scrutiny. Designed for a roughly 30-year retirement, it may not hold up if someone lives well into their late 90s or beyond.

At the same time, costs that matter most in later life are rising. Healthcare and long-term care can be especially unpredictable and expensive. Medicare doesn’t generally cover extended long-term care, leaving many retirees exposed to costs that can quickly drain savings.

Inflation adds another layer of risk. Even modest price increases can erode purchasing power over decades, forcing retirees to either spend less or draw down assets faster than expected.

With all of these factors combined, longevity has turned retirement planning into a balancing act between three competing forces: maintaining growth, preserving stability and ensuring income lasts for life.

How to make your money last as long as you do

There’s no one-size-fits-all solution, but some strategies can help reduce the risk of outliving your savings.

Build income you can’t outlive. Delaying Social Security can significantly increase monthly benefits, providing a stronger baseline of guaranteed income. Some retirees also turn to annuities, which can create a steady paycheck for life, though they come with tradeoffs, including limited flexibility and potential inflation risk.

Stay flexible with spending. Instead of sticking to a rigid withdrawal rate, many planners now favor dynamic strategies, such as spending a bit more when markets are strong and pulling back when they’re not. It’s an approach that can help portfolios last longer.

Plan for healthcare and long-term care early. Whether through savings, insurance or hybrid policies, having a plan for care needs can prevent a late-life financial shock. Without one, retirees may be forced to spend down assets quickly to qualify for assistance.

Keep some growth in your portfolio. Even in retirement, investments need to outpace inflation. That usually means maintaining some exposure to stocks alongside safer assets like bonds or cash equivalents — a balance many firms like Vanguard emphasize in retirement research. (6)

Get professional guidance. A fiduciary financial advisor is someone legally required to act in your best interest, and they can help stress-test a plan and adjust it over time. For many retirees, that peace of mind is as valuable as the numbers themselves.

Living longer is something for which previous generations have long hoped. But it’s also something you have to consider when planning for your retirement. Because the real challenge isn’t reaching 100; it’s making sure your money gets there with you.

‘They never expected to live this long’ — and now a 30-year retirement threatens to drain their savings

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The math of a longer life is reshaping retirement

How to make your money last as long as you do

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