extending healthspan leads to the need to plan for an extended wealthspan
Updated: Apr 11, 2019
Many advancements are being made in the work toward extending human “healthspan,” meaning our number of healthy years of life. As healthspan increases, so does the need for longevity planning for wealth to extend along with healthspan. There is a huge disconnect in the world of financial brokers concerning the data that supports the need for much more comprehensive planning to account for and adjust with the changes taking place in the science to extend healthspan. Wealthspan Advisors was created to provide the insight and expertise needed to plan for and meet the needs of wealth accumulation and income extension.
The following is a summary of the data that supports and need for a better wealth planning advice because of the changes taking place in health and wealth planning:
* Life expectancy rose by more than 30 years in the last 120 years -- from 50 to 80. Never before in history have so many people lived past age 65; and among those that will do so in the future, the prospect of surviving well into our 80s and 90s has never looked so promising.
* When Social Security began in 1935, the probability that a 25 year old would reach age 65 was 63.3% (59.5% for men and 67.3% for women). Today, 81.9% of men and 88.7% of women will survive to age 65.
* Every year medical technology has added about 35 days to life among those reaching their retirement ages. While this rate of improvement has slowed down in recent years, the implication of this for those thinking about retirement in the future is profound.
* More than half of everyone that reaches retirement age today will survive to age 85; and among those that do, more than 25% of them will live to age 95.
* Planning for our longer lives in this modern era of technological advancement is not an option -- it's a necessity.
* The term "lifespan" defines how long a person lives. The proportion of your life spent in good health is known as your "healthspan". While most people do spend some time later in life facing problems with their aging body and mind -- remember, this is the price we pay sometimes for the opportunity to live so long. How healthy we are in our later years is often something that is within our control, but the ability to control and maximize our healthspan is heavily influenced by how well we plan for that future during our prime and even later working years. It is right at this intersection between lifespan and healthspan -- in a world where medical advances are taking place at breakneck speed -- that Wealthspan Advisors enters the scene.
* Planning for a healthy and financially secure older age does not happen by accident -- it requires a concerted effort to first understand what is most likely to occur in the future; recognize how to best make use of available financial resources; and then execute a plan that maximizes your chances of living the life you most desire.
* When you succeed in planning correctly, you should have more than enough money to cover all of your health and financial needs for the entire lifespan of you and your spouse; and at the same time leave a financial legacy to your children and grandchildren. We refer to this desirable lifespan/healthspan scenario as "Positive Wealthspan". That is, your available financial resources exceed your need. It is worth emphasizing that people who develop and execute a plan that creates a positive wealthspan, also tend to take action in their younger years to maximize their health and minimize the high costs of medical care later in life. The psychological benefit alone of knowing that you've maximized your chances of experiencing a positive wealthspan is, in itself, a peace of mind that we all want to have.
* For those who outlive their financial resources, they will have experienced a "Negative Wealthspan" -- which is a time in life when living both healthy and comfortable is very difficult. Even if you lower your living standard to accommodate a lower level of income, the spending that is required to maintain your healthspan becomes a challenge.
* When financial resources are limited later in life, healthspan suffers.
* To give you a sense of just how many people do not plan for their personal Wealthspan, consider the fact that in the U.S., two-thirds of beneficiaries of Social Security today rely on Social Security for half of their total income; and 25% of the U.S. retirees rely on Social Security for 90% of their total income. In other words, most people in the U.S. are headed toward a scenario of "Negative Wealthspan".
The need to plan for a Positive Wealthspan has never been more critical. With Baby Boomers retiring en masse, the need to concentrate on and plan for is moving to the forefront of the financial planning business. Only those with specific, science-based data can remove the assumptions often used to develop a financial plan and replace the assumptions with known information - making for much better planning.
That's where Wealthspan Advisors comes in - the first firm in the industry to combine aging science with wealth management to create financial blueprints.