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 you show your client the likelihood that they will live to a certain age. It is based on UK Life Insurance Industry Data* and you or your client's own assessment of their general health.
You may want to explain to your client that:
- 'Good health' assumes that you are in good health, you might have had this confirmed by your doctor and you'll typically be a non-smoker, neither over or under weight, you'll look after your health and not be on any prescribed medication controlling particular conditions.
- 'Average health' assumes that you are not in perfect health for your age but you're also not suffering from any serious ongoing illness. You might, for example be a little overweight and/or your blood pressure may be higher than your doctor would like it to be, or perhaps you might be suffering from high cholesterol and taking controlling medication.
- 'Poor health' assumes that you have had a more serious medical condition or risk factor such as cancer, or diabetes that is difficult to control or you have recently had a stroke or a heart attack.
*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.