Planning for a 100-year life

Anna remembers her dad calling the family together for a glass of Champagne on the day he outlived both of his parents and telling her: “Every day from now on is a bonus”.

He had a lot of days after that, as he died at the great age of 90. After 20 years in the education system, he’d worked for 40 fulfilling years and retired at 60. That meant he’d spent 30 years in retirement, sitting on committees and doing voluntary work.

Think of what percentage of your life you’ll be working to earn money.

For Anna’s dad, it was 44.44%. For his first 20 years, he was supported by his parents. That’s 22.22% of his life. For his final 30 years, he was supported by his pension and investments.

That’s a whole one-third of his life when he lived off what he did with his earnings while he was able to earn them. Luckily, he’d invested wisely, so he enjoyed a comfortable old age.

Living until the age of 90 or more is not unusual in our society. Will you be in a good position to enjoy those years?

Note that, in retirement, you’ll experience a different income status. This is the reason why you need to work while you can to build a pension and/or a property. By the age of 90, you are likely to be in the phase of ‘decumulation’ rather than accumulation.

The 100-year life

I’ve recently been reading The 100-Year Life by Lynda Gratton and Andrew J. Scott. It’s about living and working in an age of longevity.

I was attracted to the book because it was shortlisted for the FT/McKinsey Business Book of the Year Award and because of our business name. As you probably know, Plan 100 means we build you a financial plan designed to last until you’re aged 100.

In short, the book says you need to regenerate yourself throughout your life, a bit like Doctor Who!

You’ll want to continue to feel useful – because that’s one way to feel happy and because it keeps the old ‘grey matter’ going.

You probably don’t want to become redundant like Kodak did when digital cameras and then smartphones came in. In order to remain relevant, you might have to work longer, acquire new skills, and retrain yourself.

This goal is balanced against ageism in the workplace, where older people are usually more expensive to employ.

You may, therefore, decide to develop various income streams while remembering there’s no such thing as passive income. Even owning buy-to-let property without a mortgage requires you to put in a large amount of work.

Being old and well v being old and ill

There’s a big difference between living to 100 years old and remaining well and active, and living to 100 years old but spending many of them staring at the wall in a care home.

Strong health helps us lead meaningful, productive, and satisfying lives.

McKinsey published an article in December 2022 where they shared The secret to great health. In summary:

  • The suffering we endure to achieve longevity is unacceptable and unnecessary
  • Mental, social, and spiritual health are as important as physical health and are deeply interconnected
  • Health is mostly about our ability to function, not just about disease and death
  • Health exists on a spectrum: we can’t achieve optimal health if we don’t define, measure, or strive for it
  • Most drivers of health sit outside conventional healthcare systems and are modifiable
  • Achieving great health is as much about what we pursue as what we avoid
  • People are more than patients; they deserve to be empowered with greater health literacy
  • History suggests that the societal adaptations required to improve health are feasible; every person and institution on Earth has a role to play.

They claim there is a large body of evidence demonstrating that strong health over an extended period of life is possible. In fact, their analysis suggests it’s possible to add six years of higher-quality life to every person on the planet over the next decade.

Another way to look at it is germ theory versus terrain theory.

Germ theory argues that you’ll be ill if your body is invaded by a bacteria, virus, fungi or parasite.

Terrain theory claims that a healthy body (a healthy terrain) will be resilient to almost any germ. You can achieve this through good nutrition, regular exercise, sufficient sleep, low stress and trauma, and a strong immune system.

It seems like a good idea to me to keep your body healthy, no matter how long you expect to live.

What this means to you

While you’re still working, you don’t need to hit your capital yet. But if you live long enough, a time will come when you do. And you want to be able to enjoy life when that time comes, with good physical, mental, social and spiritual health.

Optimising your health requires taking action. In the article, McKinsey identifies 23 drivers of good health, 19 of which sit outside conventional healthcare systems. They can be improved or weakened based on your individual choices.

Over to you!

As for me, I’m currently running a directly regulated business. Maybe in the future, I will make my life easier. For example, I could retrain, accept fewer clients and work fewer hours.

But I’m not there yet!

Meanwhile, it’s business as usual here at Plan 100. And a new year’s resolution to do what it takes to remain fit and healthy for as long as possible.

P.S. For more about the book, visit The 100-Year Life website

Lance Baron

Certified Financial Planner (CFP) based in East Sussex, UK. We support people in Southeast England with more than £500K to invest by building a financial plan that will help them live the life they want… until age 100