Longevity is a Significant Risk in Retirement
Living for 30 years more than you thought you would, could cost you or your family an extra $220,000 to $540,000. If you don't have savings to fall back on you may have to move in with your adult children. Or become a ward of the state if. Living a very long life is having longevity. Living for another 30 years past the age of 85. By 2051 there will be 2.8 million adults over the age of 85 many will require care. That's a 285% increase in the number of retired over 85's in Canada, over the next 35 years.
We are healthier, and fitter going into retirement, and have better healthcare. All of which are contributing to living much longer. Much longer than our grandparents. This also makes the case for developing a government sponsored long term health care insurance pool to help look after an ageing population. The alternative is moving in with your adult children if you run out of money, live too long, or require some form of care. Your adult children that moved back home, lived with you when they were establishing them selves on the road to self sufficiency.
Thinking about retirement is difficult to imagine when your 23. It becomes easier to think about when you are 55 and 10 years away from retiring. When you seriously start thinking about retirement could you ever imagine living for 122 years and planning for longevity? Even harder to imagine is how much more money do you need to live that long? You might need another 30 years income cover at an average of $36,000 per year or $540,000 if you planned to live to 90 or so in your retirement calculations.
The government of Ontario pays approximately $18,000 of the $36,000 they might contribute to your long term care costs, that`s if you can find a place to go. There are 76,982 long term care beds in Ontario (Ontario Long Term Care Association Report 2016). Using current trends and projections we need another 142,216 Long Term Care beds by 2051. Clearly this isn't going to happen unless funding increases from $4 billion per year to $11 billion per year (just in Ontario).
The cost of longevity is in the range of $220,000 to $540,000 and in most cases is highly likely to be paid by various governments if they don't run out of money. If you have longevity in your family you will either need to purchase a long term care policy or need to save an extra $220,000, or move in with your children.
When you look at the oldest 100 retired folks that are or were living their age ranged from 114 to 122. And 94% were women and only 6% of the oldest people in the world were men. Source: Wikipedia 100 oldest verified people
How will we support over 2.8 million retired folks over the age of 85 by 2051? Statistics Canada last census summaries below shows the significant actual growth rates and projections for for the population aged 85 and older in Canada from 1966 to 2051.
Census in Brief - Statistics Canada (Release date May 3 2017)
A portrait of the population aged 85 and older in 2016 in Canada
In 2016, there were over three-quarters of a million (770,780) people aged 85 and older living in Canada, representing 2.2% of the Canadian population overall and about 13.0% of the population aged 65 and older.
The number of people aged 85 and older grew by 19.4% over the period from 2011 to 2016, nearly four times the rate for the overall Canadian population.
The centenarian population (i.e., those aged 100 and older) grew even faster, by 41.3%, to reach 8,230 people, making it the fastest-growing age group between 2011 and 2016.
There were nearly two women for every man aged 85 and older, which mostly reflects the differences in life expectancy between the sexes. Among centenarians, this ratio is higher, at five women for every man.
In 2016, one-third (32.0%) of people aged 85 and older lived in collective dwellings such as nursing homes and residences for senior citizens. This proportion grew to two-thirds (66.6%) among centenarians.
Many municipalities with a high proportion of people aged 85 and older in 2016 were located in British Columbia.
Source Statistics Canada
