Long Life Planning | Webb Investment Services

{ LONG LIFE PLANNING }

What is Long Life Planning?

Long Life Planning, also known as Longevity Planning, is planning for the potential of a long life. It’s not just about your life now, but about what it will become and your changing needs as you age.

A few generations ago (back in 1900), the average life expectancy for the industrialized world was under 50 years old. Today, individuals are living well into their 70s, 80s, and beyond. Due to this increase in lifespan Dr. Jo Coughlin of the MIT Age Lab states that:

“We have a longevity paradox. Now that we have achieved what humankind has tried to achieve since it has walked – living longer we really don’t have a good idea of what to do with all that additional time.”

This is very different from what past generations experienced. Retirement is no longer a relatively brief period at the end of one’s life. Most people now feel excited about what lies ahead; imagining endless days devoted to travel, grandchildren, and golf. But chances are, retirement may be a bit different. The idea of retirement as a brief period of relaxation and reward is often a misperception.

So how will you spend your 30-year longevity bonus? Longer life expectancy requires new thinking. It’s not just about planning for retirement, but also planning for all the years you might live once you stop working, all the ways your life will change and all the events you can’t foresee.

This is where working with a financial planner who has experience and expertise in Long Life Planning can help to ensure your future success.

Longevity Planning in 8,000 Day Increments

Dr. Coughlin of the MIT Age Lab has looked at modern retirement on a mathematical scale, assuming a person with a college education and good income will live well into their 80’s, or will have 8,000 days in retirement. This 8,000-day story allows us to have a a clear vision to plan and to anticipate what is likely to come.

An individual’s life can be broken into 4 periods of time (roughly 8,000 days long):

LEARNING THE 1^ST 8,000 DAYS

Birth
School
”Enjoying” your teenage years
College

GROWING THE 2^ND 8,000 DAYS

Starting a career
Relationship/marriage
Owning a home
Becoming a parent

MATURING THE 3^RD 8,000 DAYS

Prime career years
Enjoying your income/buying cars/nicer houses/nicer vacations
Planning for retirement

EXPLORING THE 4^TH 8,000 DAYS

Retiring
Becoming a grandparent
Travel, golf, volunteering
Now what?

The Reality of Retirement

Many of us view life after retirement to include extended work, even if part time, leisure activities, and spending time with family or volunteering as activities that we will be doing.

Though these pursuits suggest a healthy perspective on aging, they may indicate an overly generalized vision of what could also involve decades of changes in work, health, finances, housing, marital status, and countless other activities.

The Four Phases of Retirement

Not every day of retirement will look the same. We often ponder what the first day of retirement will look like, but what does day 5,852 look like? Instead of looking and planning for retirement as a single phase, it is beneficial to divide retirement into four phases. By looking at each phase, one can work toward a clearer vision and path of what is likely to come.

Preparation done effectively, and realistically, can help to reduce anxiety related to uncertainty and increase long-term independence and control as you progress along the continuum. A good financial planner can serve as a guide to all the options and costs as your life progresses.

These are the healthy years of retirement, meant for enjoyment. The average person in their 60’s is likely to enjoy nearly 20 years of health ahead of them. This is viewed as the honeymoon phase where individuals focus on travel and leisure activities, perhaps some consulting or part time work, or even volunteering to help them stay engaged. This is the time to pursue new and existing interests but also to safeguard against potential decreases in resources through proper planning. This may also be a time where you are sandwiched between caring for aging parents as well as continuing to support your adult children.

In the second phase of retirement, work is in the past, and this phase comes with more ‘free’ time than before. It may also come with less vibrant health, but also an opportunity to make or renew social connections. More time to socialize or even travel together and work may be replaced with volunteering, travel, being an involved grandparent, or hobbies. But this phase also comes with BIG decisions:

UPSIZE OR DOWNSIZE
Get a new car? Stay in your hometown or move for the climate or family? Move to a retirement community? These decisions can be both emotional and financially impactful.

FINANCIAL DECISIONS
By now you are potentially taking a greater share of your income from different sources like Social Security, pension, retirement accounts, and investments. These decisions need to be made in the context of your financial and your estate plans. Now is the time to create or renew an estate plan.

In this third phase of retirement, managing your health and the logistics involved can feel like a
fulltime job. This is the phase of more medical appointments, managing medications, and an increase in mobility issues. This is where health care spending starts to take off.

92% of aging adults over 85 are managing at least one chronic condition and 77% are managing two or more chronic conditions.

Changes in your health or your partner’s health can lead to changes in one’s social well-being with fewer opportunities to join friends and family.

You may have a need for better or more suitable housing and occasional or daily care from a friend or family member to help with errands and home maintenance. You may also and yourself asking who will make decisions, both financial and health related ones, as your physical or mental capacity diminishes.

In the fourth phase of retirement, health and physical issues can quickly and rapidly come to the forefront. A single event such as a fall, a stroke, or a diagnosis can immediately change one’s lifestyle and needs. A serious event for a spouse can greatly impact the well-being and safety of the household. This can dictate the need for a caregiver to help with not only errands, but provide transport, or help with activities of daily living (ADLs) such as dressing, feeding, and toileting.

In this phase, women often outlive men. In fact; 44% of women and 24% of men over the age of 77 live alone.

This presents the need to take additional steps to make sure one has adequate resources and work to mitigate risks. This may include a plan to move in with family or to an assisted living facility or long-term care facility. This is also the phase where conflict could arise between family members concerning your safety and care, if you should live alone.

This is where clear intentions and previous plans put into place like a power of attorney, health care power of attorney, and more, can help loved ones understand your desires to age with dignity and to have your wishes respected.

Although this may seem like a sad time, with the depletion of physical, financial, social and maybe even cognitive capacity, emotional well-being in older adults is high in comparison to other stages of life.

In fact; Americans 75 years old and over have the highest well-being rankings compared to their younger peers.

This suggests that with proper planning can help aging individuals feel optimistic about their own longevity.

What Questions Should You be Asking?

In addition to financial implications, retirement has life implications. Our knowledgeable and experienced team can help ideal clients sort through the possibilities. Our Approach is designed to guide you up to and through the retirement you’ve always envisioned. As you being this process, here are some important questions to ask:

Your physical and fiscal health are very interrelated. Many expect that Medicare will pay for all their medical expenses in retirement, but in reality, it only covers 60% of health care costs. You still pay premiums, copays, and deductibles. As you age these costs can really add up.

Other items to discuss with your financial planner:

Do you have an existing condition? What will treatment cost over the long term?
Do you know what costs Medicare will cover?
How will you pay for what Medicare doesn't?
Have you considered Medigap?

Planning for your long life is important, but what happens when you are gone? What kind of legacy do you want to leave? Are you prepared for your legacy to pass to your heirs so that it can continue far past your time on earth? How do you ensure its secure?

Have you spent significant time thinking about your legacy?
Who will have access to your important documents and information when the time comes?
How will you protect your assets and inheritors from financial fraud?

Planning for a long and fulfilling life requires careful, detailed long life planning. Strategies to consider include: saving, investing (including asset allocation and location), taking withdrawals (including cash flow management), and making the right decisions surrounding Social Security and pension options. To name a few.

When are you planning to retire?
What sources of income will you have in retirement?
How much income will you need in retirement?

Longevity Resources

Service Type	Organization	Website
LGBT Aging	SAGE (Advocacy & Services for LGBT Elders)	www.sageusa.org
Aging Research	MIT AgeLab	agelab.mit.edu
National Life Long Learning Institute	Osher National Research Center	sps.northwestern.edu/oshernrc
Social Security	Social Security Administration	www.ssa.gov
Caregiving Resources and Support	ALSKA	alska.com
Support for End of Life Conversations	The Conversation Project	theconversationproject.org
Caregiver Support and Services	Wellthy	www.wellthy.com
Alzheimer's and Dementia Resources	Alzheimer's Association	www.alz.org
Helping Seniors Fight Social Isolation	Connect to Effect	connect2affect.org
Senior Resources	AARP	www.aarp.org
Healthy Aging Resources	Vistalynk	www.vistalynk.com
Elder Law Certified Attorneys Information	National Elder Law Foundation (NELF)	nelf.org

Service Type	Organization	Website
Life Long Learning Institute	OLLI (Osher LifeLong Learning Institute) at UNCA	olliasheville.unca.edu
WNC Senior Resources	AARP Mountain Region, NC	local.aarp.org/asheville-nc
Care Managers and Patient Advocates in the Carolinas	IKOR of the Carolinas	ikorcarolinas.com
Alzheimer's and Cognitive Impairment Treatment	MemoryCare	memorycare.org
Active Adult and Retirement Communities List	Carolina Living Choices	carolinalivingchoices.com
Aging Services, Education, and Advocacy	Council on Aging	www.coabc.org

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Any opinions are those of Webb Investment Services and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notice. Raymond James is not affiliated with and does not endorse the opinions or services of Dr. Jo Coughlin or the MIT Age Lab. This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. Investing involves risk and you may incur a pro-t or loss regardless of strategy selected, including diversification and asset allocation. Prior to making an investment decision, please consult with your financial advisor about your individual situation. The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation.