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Room for Error

Dennis Friedman

I’M SUFFERING FROM shoulder and foot pain. My doctor said I’ve done too many pushups and run too many miles. He scolded me, saying, “You’re 70 years old. You’re not 30 anymore.”

When I wake up in the morning, the pain radiating from my shoulder and foot makes me feel much older. My dentist also reminds me I’m not getting any younger. When examining my teeth, he noticed severe erosion along my gumline. He said, “If you were 36 years old, I would say let’s do something about it. But at your age, I don’t think it’ll be necessary.”

I’m not confident I’ll live a long life. But I believe I have more time ahead of me than I currently feel. How many more years? According to my retirement plan, I’ll live until age 100. That’s the age used to estimate how much I can spend annually.

A recent study by the Society of Actuaries found 28% of Americans age 50 and over underestimated their life expectancy by five years or more, with women more likely to underestimate their longevity than men. Your life expectancy is the foundation for your retirement planning. Underestimating longevity can cause you to run out of money later in life by not saving enough, retiring too early or spending too much in retirement. It could also cause financial stress.

I admit it, I may be overestimating my longevity. The probability of me living to 100 is quite low. But when planning for retirement, I’d rather err on the high side than watch my savings diminish in my later years. It’s also why I delayed my Social Security benefits until age 70.

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