Living to 100 is no longer a far-fetched dream. Thanks to medical advances, improved nutrition and healthier lifestyles, more people are reaching triple digits. Still, while living longer is a gift, it also brings financial challenges — and opportunities. Welcome to the longevity economy, a growing sector shaped by the wants, expectations and spending power of older adults.
What Is the Longevity Economy?
The longevity economy refers to the economic impact of an aging population, especially those aged 50 and older. In the U.S., this demographic is expected to have a significant economic impact on industries such as health care, housing, travel and technology in the coming years.
But this megatrend extends beyond spending power and chronological age. As Dr. Panayotis Vardas, an adult cardiac surgeon and an associate professor in the division of cardiothoracic surgery at the University of Alabama at Birmingham, points out, health-care innovation will increasingly focus on biological age — not just chronological age.
Why Planning for 100 Is Smart — Even If You Don’t Reach It
You may not expect to live to 100, but what if a long lifespan materializes anyway for you or your spouse? Planning for a 100-year lifespan helps manage longevity risk — the very real possibility of outliving your savings.
If you don’t plan for a long retirement period, you could face downsizing or cutting back your lifestyle in later years, becoming financially dependent on others, or being caught off guard by rising health-care or long-term-care costs.
But if you do plan ahead, you’re more likely to spend with confidence in retirement, protect your independence and dignity as you age, and leave a financial legacy — if you don’t end up needing every dollar. Here’s a road map for the long road ahead:
- Begin With the End in Mind
- Who will you spend your time with?
- What do you want (and need) to do?
- Where do you want to live?
- When would you like to retire?
- What gives you purpose and fulfillment?
- Rethink Your Retirement Timeline
- Phase 1 (60s–70s): Active years — travel, hobbies, maybe part-time work.
- Phase 2 (70s–80s): Slower pace, healthcare needs rise.
- Phase 3 (80s–100): Focus shifts to safety, care and income stability.
- Customize Your Withdrawal Strategy
While this is habit #2 from Stephen Covey’s book, The 7 Habits of Highly Effective People, it deserves to be topic #1 for any retirement strategy, especially in the longevity economy. What comes to mind when you think about a long retirement period? How will you spend your time? While 75% of 50- to 59-year-olds say they’ve made a serious effort to plan financially for retirement, only 35% in this age group have planned emotionally for it. That’s an important distinction.
T. Rowe Price’s Visualize Retirement program suggests retirement investors think carefully about the 5 W‘s (summarized):
Answers to these questions will help forge the “why” behind your retirement.
Now, let’s discuss how to fund it. Depending on spending priorities, many retirement investors may need to replace as much as 60%-80% of their work pay in retirement. Some savings milestones throughout your career to help you get there: Aim to save 1x your salary by age 30, 3x by age 40, 6x by age 50, 8x by age 60 and 10x by age 67.
What’s the one action step that could have the most meaningful impact on an individual’s savings goals for retirement? Save 15% of your income.
In the U.S. today, life expectancy is 78.4 years, according to the U.S. Centers for Disease Control and Prevention, compared to 61.7 when the Social Security program began and the retirement age was set at 65.
How American workers think about time horizons for work and retirement has also shifted over time. Transamerica’s “2025 Retirement in the USA: The Outlook of the Workforce” survey found 36% of workers either plan to work until age 70 or not retire at all. And more than half of workers plan to work at least part-time in retirement.
Instead of assuming retirement will begin at 65 and last 20 years, consider a phased approach:
Each phase may require a different budget and investment strategy.
A common rule of thumb for sustainable, annual retirement spending is the “4% rule.” While this method is a reasonable starting point for retirement withdrawals, longevity planning requires more nuance. Vanguard's research on sustainable withdrawal rates suggests that a variety of variables, such as giving priorities (or bequests), depletion (or risk tolerance) and asset allocation, play a vital role in retirement. Relying on old rules of thumb could mean prematurely depleting the portfolio.
The Bottom Line
Living to 100 is becoming more common, so planning for it is one of the smartest financial moves you can make. A longer life offers more time to enjoy family, purpose and experiences, but it also requires careful planning to avoid outliving your savings.
The good news? You don’t have to do it alone.
A CERTIFIED FINANCIAL PLANNER® professional can help you build a strategy that aligns with your values, income sources, investment approach and legacy goals — so you can feel confident no matter how long retirement lasts.
Get started on securing your financial future today
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