Many people may underestimate just how long they could live for in retirement. And yet that difficult, and sometimes sensitive, question is at the heart of many of the current discussions around pensions, annuities and retirement income solutions.
Planning your retirement income is very tricky – your client may have no idea how long they will be around for or how long their retirement income needs to last. That's where our calculator can help.
Using the tool
This calculator helps give an indication of the chances of living to certain ages. It is based on UK Pensions Industry Data* and your own assessment of your general health.
You may want to explain to your client that:
- 'Good' This doesn't mean that you run marathons regularly! It simply means you're likely to be a non-smoker, neither over nor underweight and don't have any medical conditions.
- 'Average' You are neither in perfect health nor suffering from any serious long-term illness. You might be a little overweight and/or your blood pressure or cholesterol may be higher than your doctor would like.
- 'Poor' Perhaps you’ve had a more serious condition like cancer, a heart attack or a stroke. Or you have diabetes which is difficult to control or you’re a heavy smoker.
*The Continuous Mortality Investigation (2015).
You can find out more about the Longevity Calculator by reading our guide.
Once your client has a better understanding of what age they may live to, and how long their funds may need to last, they can start to consider the decisions they make in retirement. For example, they may prefer to have a part of their income guaranteed, so that they have peace of mind that minimum expenses and costs are likely to be covered. Or it might be that they want to include protection against escalating costs or inflation if they are likely to live for many more years.