Longevity Is Going To Crush Retirement Plans
The longevity movement, according to its supporters, is alive and well. Many believe that we will see major breakthroughs in technology that will extend the lives of people by many decades.
While there is great debate as to whether we can eclipse the 120 year old mark, many believe that will we see a large number of people in coming decades pushing the 100 year level.
This is in keeping with the advancements that were made already. However, if one believe that everything is information, then the advancements we make in that area will end up extending to biology.
Certainly this would be welcomed news for individuals, it brings on a host of financial issues.
Source
Retirement plans are already woefully underfunded. Many, if not all pension funds, find themselves short of the required assets needed to pay their future obligations. Then there are the individuals who are lacking the money, especially in the United States, to retire with the expected lifespan as it is now.
Life insurance policies are based upon actuarial tables. If these shift radically, things will really be upset.
Presently, there are more centurians than ever before. This is mirrored by every age group of seniors. Throughout the world, we are facing aging populations as declining birth rates are being offset by people living longer. From an economic perspective, this is exactly the opposite that is required.
With less people of working age who are paying into the system along with more people taking from it, we can see how governments and private funds will find themselves in an upside-down situation.
Of course, for those who are self funding their retirement through their own contributions, are they in a position to be able to handle living another couple decades?
Considering that most, at least in the United States, are already in trouble regarding their retirement, the answer is obviously no.
The radical life extension is not going to have much impact on those in their 70s already. They will miss any gains that are made. However, this is not true for those in their 40s and below. Those age brackets have a good possibility of gaining some extra years due to breakthroughs.
Fortunately, these are the ones who should have the time to fund their retirement plans. The challenge is that, like those ahead of them, they are already falling behind.
Working out way down to the Millennials, the age group that should be able to best fund things long term, they are having problems getting started. Many of them are already burdened with student loans meaning that a portion of their cashflow is going to debt repayment.
Then we have to consider that many cannot find good paying jobs as the wage market is tough due to the threat of automation. Here we see added pressure on them in terms of setting aside money for later in life.
Source
We also have the variable about the trust people have in markets. What we saw the last couple of months is that the average investors is playing short-handed when it comes to this arena. The major institutions are jumping people's trades in an effort to scalp a few percentages off each trade.
Over time, this adds up a lot of money being siphoned from the retail investors.
Perhaps crypto will help the younger generations. They are the ones more apt to get involved as compared to the older ones. This could well set up to be a great approach considering the explosive growth rate.
Society is facing major changes due to demographics. As we get older, automation is going to have to step in to make up for a lot of shortcomings. Elderly people require care, something that could be difficult to do with humans in an inverted society based upon age.
What will thinks look like if the life expectancy shoots up over 90 in the next couple decades? We are already ill-prepared as things stand now.
The longevity could crush what is left of retirement plans.
If you found this article informative, please give an upvote and rehive.
gif by @doze
logo by @st8z
Posted Using LeoFinance Beta
https://twitter.com/taskmaster4450/status/1377432034981765120
You hit the nail on the head when it comes to retirement. The answer to this is actually cryptocurrency in the form of what we are using in hive. There is no country border separating the earning and distribution of crypto on the hive blockchain. People who stake the token are earning passive income due to everyone else on the planet who are willing to work on curating and creating blog posts. The old way of investing will fail because civilization is evolving.
People live longer will require more dividends/passive income. Imagine investments that has no country border restrictions and central banks manipulations. Hive as a decentralize platform that can create a passive income is one solution for the type of investment people can have and should do. Thanks for another insightful post.
It is hard for me to trust long term investments because always things change and not always guaranteed, I totally agree with you :)
Correction: Longevity is going to Crush Retirement Plans NOT STAKING CUB. lol
If defi truly gains mass adoption, these funds would actually have time to make up some ground. As you say, the actuarial tables are slanted against them as far as life-expectancy, but they could very well be slanted towards them when it comes to ROI. If their plans call for earning minimal percentages in bonds and other "safe" assets, they could actually make up some serious deficiencies if they could all of a sudden count on 5% a year.
Not sure if that will be possible in the future yet or not but....looks somewhat promising at this point.
Posted Using LeoFinance Beta
It is possible for individuals to put a bit of money in DeFi and see what they get out of it.
Forgetting the absurd returns, even if the DeFi returns settle at around 15%, that would make up ground very quickly.
Posted Using LeoFinance Beta
Congratulations @taskmaster4450le! You have completed the following achievement on the Hive blockchain and have been rewarded with new badge(s) :
You can view your badges on your board and compare yourself to others in the Ranking
If you no longer want to receive notifications, reply to this comment with the word
STOPTo support your work, I also upvoted your post!
Check out the last post from @hivebuzz:
You have to keep your flexibility and your plans to keep pace with the age
You should have not only plan B but Plan C to Z
You must move with the world in any direction so that you can keep pace with them even if you are going to ascend to Mars
Posted Using LeoFinance Beta
The pension funds were already in trouble so those of them depending on it will be in for a rude awakening. Then we also have those who invested their savings only to get kicked out during the housing crisis in 2008 and the few market crashes where they got out due to fear. Either way, it ends up being the poorer people getting out due to fear or because they required the money during times of economic hardship. While the rich buy it up for cheap and keeps earning more and more money.
Posted Using LeoFinance Beta
Yes you are right. With the advancements in technology, life is getting more better and people live more now. This means more old age people will be there and this makes problems with the retirement funds. If you save a dollar today, it will be less worth tomorrow. So this is the main problem.
Posted Using LeoFinance Beta
I personally won't crush any plan. Not in my 70's, but I doubt I will even get to 70. I guess that's what they're trying to take care of with the vaccines.
Posted Using LeoFinance Beta
Very interesting. Those are definitely some concerning statistics. I think my biggest issue would be with the whole quality of life thing. What is the point of living to 120 if I am bed ridden for the majority of my later years. There will certainly have to be a line between just being alive that long and actually living that long.
Posted Using LeoFinance Beta
That's the point of the longevity research. They're treating aging and aging related sickness. So your quality of life will improve, too.
Posted Using LeoFinance Beta
I hope so!
If health span increases along with life span then people will simply work until they are older which will make finding a job difficult for younger people
Posted Using LeoFinance Beta
Big reason I've started looking more closely at our financial situation this last year, that and covid of course and making a plan for us instead of relying 100% on pension funds. Either the age of retirement is gonna be pushed back by a lot or automation will reach a point where it can provide enough resources for everyone but I'm afraid greed will mess with that. Still a basic income might at some point be necessary as actual need for labour decreases dramatically.
Still technological advancements in health care could also boost the age at which people can/want to work and help vitality in later years. If it doesn't living that much longer really isn't even making much sense to me.
Posted Using LeoFinance Beta
I'm not that concerned with longevity. The whole point of ot is exponential improvement in quality of life and productivity. So you will be able to work longer. And if you want to think REALLY futuristicly the idea of having to work for your money will disappear at some point with exponential rises productivity and automation.
At some point there just won't be enough work for people. Universal Basic Income is inevitable. We just don't know if it will be in our lifetime or the next. I'm not pushing for it. It's way too soon right now. But one day it will work. Look at hive right now! People are already getting paid decent money for likes and comments!
We are reaching a point, where more and more people start generating passive income.
I might have to write an article on my own. This is fascinating and needs more thought. Thanks for the idea. :)
Posted Using LeoFinance Beta
We tend to think all life extension is good, but how many of us have had or have relatives who are only alive because of constant - intensive care and medication. While it is true we can extend lives, it may be done at great cost to quality.
Its the cost of that long term intensive care that concern me the most. 2-4-10k a month depending on what is needed will destroy almost any retirement that could be built up from even the biggest savers.
The growing trend of going after the children of those in care claiming Filial Responsibility is also alarming and makes things even more complicated.
Posted Using LeoFinance Beta
I'm practically at peace with the thought that most likely pension funds will collapse most likely before I'll reach the legal retirement age. That's why I'll focus entirely on achieving financial freedom disregarding the prospect of a pension.
Posted Using LeoFinance Beta