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Financial Planners need to start thinking about how long our clients are likely to live.  In 1936 life expectancy was about 61 years old.  Today, expectancy has grown to 77 years old. 

I’ve read that life expectancy is growing by one year for every four calendar years.  That means that we’ll have a life expectancy in the mid 80’s in another twenty years.

There is no way that Social Security or Medicare can continue without major changes and stay solvent.  There are going to have to be major changes made.

We need to think about what the future might bring.  Clients that are under sixty years old are likely to be living for a very long time.  With life expectancy being 77 years old today, half of our clients will live longer than that and half less. 

Those who longer need to think should have planned what life will be like and how long they should plan to work.  I think a conversation with our clients about work and life expectancy is prudent.  After all, social security is likely to either be means tested or age extended or both.

We need to think about what health care will look like.  Medicare exists because old people get sick.  Before Medicare old people often went without care.  Now, we have care and old people get good to excellent medical care.

There are major changes afoot in medical care.  I’ve read that its likely Alzheimer’s will become a disease of the past.  I’m reading that other chronic diseases are on the cusp of having breakthroughs that will dramatically extend life.

Some of this care will be very expensive and some will help us live longer.  It really is true 75 will is the new 65.  Because of this we need to think about how life will be and what our financial reality is going to be.

Financial planners need to incorporate a long life with diminished government support.  As we continue to live longer, life is going to change.  As my friend Susan Bradley says, “when money changes, life changes – when life changes money changes.” 

Those of us in the financial planning field need to think globally, but act locally with our clients.  We need to plan for a very long life for our clients and help them plan for less government support.  This way we are helping our clients stay solvent and help them not have negative events around their financial life.

Have you thought about your financial life?  If not it might make sense to have a conversation with a planner.

Josh Patrick

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Topics: life insurance, financial planning, medical insurance, lifetime income, entitlement

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