Opinion: Retirement planning is essential for future silver surfers
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The rate at which life expectancy has increased over the past century is not only staggering but, on paper at least, a cause for celebration.
According to the Office for National Statistics, in 1911, average female life expectancy was 55; for men it was 51. Today, both figures have increased by roughly three decades, the result of better medical provision plus a huge improvement in living standards and diet.
The most dramatic period of increased life expectancy occurred between 1890 and 1950 and though the rate has since slowed, it has done so only slightly. There’s still every chance that children born a decade from now will have an almost even money chance of living until they’re 100.
Not only are we living longer, but we can also expect to live a healthier later life. Gone are the days when reaching 65 was considered an achievement and, for most people, a time when looking after the pennies was essential. Foreign holidays were anathema even fifty years ago. The closest anyone got to a short-haul journey was boarding a coach to Scarborough or Southend.
During the 1960s, retirees looked forward to little more than putting their feet up, not least because they had lived through two world wars and a period of prolonged economic depression when genuine poverty was rife.
Working conditions in the first half of the twentieth century were also considerably tougher than they are today; no wonder people reaching 65 as the Beatles appeared on the scene fancied taking things easy. They did so in the reasonable expectation that the state pension would enable them to live modestly for their remaining days.
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Today’s silver surfer is not only healthier, he or she is significantly more active and more inventive when it comes to spending their free time and money.
According to research published by the Centre for Economic and Business Research (CEBR) and Saga, the over-50s account for approximately half of all consumer purchases. Behavioural analysts Coniq revealed that consumers aged over 50 spend almost three quarters (71%) more per visit to shopping centres than other age groups.
And there’s more. Pre-pandemic, information company NPD Group calculated that the over-fifties spent a total of £6 billion just on going out to lunch.
Not surprisingly then, the CEBR research also found that spending growth by the over-50s is rising three times faster than that of younger folks, yet the older cohort is much more than a bunch of well-heeled shopaholics. How and where they spend their money is also changing.
Since the turn of the century, there has been a marked shift by the fifty-something consumer towards spending money on ‘experiences’ instead of traditional purchases such as clothes or other products we associate older people.
Prior to the arrival of Covid, the over-50s accounted for more than half (58%) of all expenditure on travel and tourism, a figure which had increased by a fifth since 2012.
Clearly, these statistics show beyond doubt that large numbers of baby boomers have discovered how and where to spend their accumulated wealth, but the expenditure is – or should – be prefaced by an exercise of huge importance: retirement planning, the most essential aspect of which is ensuring you do not run out of money.
The definition of ‘retirement planning’ has widened over the past few years to accommodate the older cohort’s preparedness to take advantage of the good fortune bestowed upon it.
In terms of health, money and attitudes, sixty really is the new thirty. Whereas their parents and grandparents may once have felt that reaching their seventh decade was a good point at which to slow down, today’s would-be retiree is so full of ideas, plans and energy that planning how to achieve their ambitions has become as integral to the silver surfers’ modus operandi as a detailed world atlas and a well-considered bucket list.
In his outstanding book, The Number, author Lee Eisenberg endeavours to help readers (the prospective retiree, as well as those who have already finished with full-time work) establish how much they need to “lift your spirits and make your heart sing through old age.” Anyone over 45 should read this book, dealing as it does with concepts such as the ‘satisfaction factor’ and ‘uncertainty principles’.
He concludes that: “An unexamined life may or may not be worth living – but it’s almost always more costly than an examined one.”
In other words, if you fail to conduct some form of retirement planning, you’ll almost certainly plough through your wealth faster than you may have imagined.
The implications for silver surfers’ travel, business, spending, and associated lifestyle plans are disappointingly obvious and could leave you rueing, or at least not celebrating, increased life expectancy.