Sadly, Coronavirus has caused more than 40,000 Britons to lose their lives over the past six months. It has affected all of us to a greater or lesser degree, whether through the loss of a loved one, sickness, social isolation or shielding.
However, and without wishing to minimise the impact of the disease, it is worth remembering that the trend in terms of life expectancy for most of us is upwards. In fact, according to latest statistics from the Office of National Statistics (ONS) the proportion of people aged 85 years and over is projected to double over the next 25 years. Although reaching one’s 100 th birthday is still relatively unlikely (in 2014 there were estimated to be 14,450 centenarians living in the UK), the number is growing. In fact, over the 30 years since 1984, it has quadrupled.
So, what does this mean for later life planning? In particular, how can you make sure you have enough money to last your lifetime – whether you live to be 80, 90 or over 100.
This is the question which our Financial Advisers are faced with most often and that causes the most worry to our clients. It’s all very well living to be a ripe old age, but we all want to live comfortably and without having to penny pinch.
The key to being able to sustain an enjoyable retirement is to build up enough capital to provide the required level of income in retirement. Of course, increasing longevity means we need to build up a bigger ‘pot’ than would have been the case for previous generations. This may mean having to work for much longer – perhaps even into our 70s – to be able to enjoy the same level of pension as our parents may have done.
What’s certain is that we cannot rely on the UK state pension to provide us with sufficient income. Therefore, it is up to us as individuals to build sufficient capital for our futures.