Planning for retirement means determining how a lot cash you’ll want and the way lengthy it must final. A brand new survey reveals that whereas many millennials count on to spend 30 or extra years in retirement, most Individuals battle to estimate how lengthy they may dwell.

This hole in «longevity literacy» can result in under-saving, untimely withdrawals, and monetary shortfalls later in life. Understanding your potential lifespan is a key a part of constructing a extra secure retirement plan.

How Longevity Impacts Your Retirement Technique

Your life expectancy shapes how a lot you want to save and the way lengthy these financial savings should final. In the event you underestimate your lifespan, you may draw down your funds too rapidly or retire too early. In the event you overestimate, you would possibly work longer than essential or dwell too frugally. Getting it right is the important thing to your long-term monetary safety.

Understanding your projected lifespan is simply as vital as figuring out your month-to-month retirement bills or ideally suited withdrawal price. It additionally performs a key function in choices like when to assert Social Security and tips on how to construct a sustainable drawdown plan.

What the Survey Reveals

A 2025 examine discovered that one in 4 millennials expects to spend 30 or extra years in retirement, however most individuals aren’t planning with that sort of timeline in thoughts.

The analysis, from the TIAA Institute and the World Monetary Literacy Excellence Heart (GFLEC), additionally confirmed that almost 40 % of millennial staff count on to dwell to age 90 or past. Nonetheless, they’re not adjusting their retirement age accordingly. For each additional yr of life they count on, they solely plan to work one month longer.

When requested fundamental questions on life expectancy, many Individuals have been off the mark. A couple of-third underestimated how lengthy a typical 65-year-old lives, and about one in 4 admitted they didn’t know in any respect. That sort of blind spot can lead you to save lots of lower than you’ll really want or begin spending your nest egg too quickly.

Why Longevity Literacy Is Usually Ignored

Many individuals underestimate simply how lengthy retirement can final, particularly these planning to cease working earlier than age 65. Whereas medical advances have prolonged life expectancy, public understanding hasn’t stored up. Monetary training typically focuses on how to save and invest, however not often teaches individuals tips on how to plan for a multi-decade drawdown.

In consequence, staff might overlook vital elements like their private well being, household historical past, or gender-based longevity tendencies. Youthful generations, specifically, miss early alternatives to harness the facility of compounding or discover instruments like annuities that may present revenue for an extended retirement.

Construct Longevity Into Your Retirement Plan

• Use a retirement calculator to estimate, however be sure you think about elements like your age, well being, and household historical past when making projections about your life expectancy.
• Plan for at the very least a 30-year retirement when you count on to cease working in your 60s.
• Take into account delaying Social Security to extend assured month-to-month revenue later in life.
• Observe a sustainable withdrawal strategy, just like the 4% rule or a guardrails technique.
• Discover lifetime income options, corresponding to annuities, to cut back the chance of outliving your financial savings.
• Speak to a financial advisor about tips on how to align your financial savings, funding, and revenue plans with an extended retirement horizon.

The Backside Line

In the event you’re not planning for an extended life, your retirement technique might fall quick. Longevity literacy will increase your capability to realistically assess how lengthy you would possibly dwell. This may also help you construct a safer, sustainable monetary future.

By utilizing higher estimates and planning for an extended time horizon, you’ll be able to keep away from shortfalls and make smarter choices about saving, spending, and investing in retirement.