Longevity is a textbook ‘good problem

Longevity is a textbook ‘good problem ’By Bruno Scanga Financial Columnist Longevity is a textbook ‘good problem’ for Canadian society, one that financial services professionals now must solve. Thanks to advances in health care and wide access to health care services, Canadian life expectancy continues to rise. Life expectancy at birth is now 82.16 and life expectancy at age 65 is now 86.15. That feat of longevity now creates a new slew of risks for retirees, namely that they will outlive their retirement savings, especially if they face high health care costs late in life. Those risks are compounded for the 52 per cent of Canadian workers who do not have access to any kind of employer-sponsored pension plan. Canadians now need to plan to live off their savings for decades, and many of them need to plan to do that alone. Retirees face as they live longer and highlighted how consistent retirement income and clear decumulation strategies can help manage those uncertainties. The importance of the advisor in this period, noting that decumulation can be far more complex and challenging than the accumulation phase that precedes retirement. “I think retirees are facing several key uncertainties. They don't know exactly how long they'll live, what future market returns are going to look like, or even how inflation will affect their purchasing power over time. And taken together, these risks can have a significant impact on retirement security, What we're seeing is that longevity risk has increasingly shifted from the institution to the individual. And retirement planning today requires a much greater focus on generating dependable income and managing risk while over what could be a very long time. Remember not all advisor offer the same services and solutions. Ask questions and find solutions that meet you needs.