Life Expectancy Is Rising - Here’s How That Changes Retirement Planning

What would you do with 30 years of retirement?

It might sound far-fetched, especially if you’re used to thinking of retirement as a 10- or 15-year chapter. But for many people retiring today, a 30-year retirement is becoming more common than rare.

Thanks to advances in healthcare, nutrition, and awareness, we're living longer than ever before. In fact, one in four people in their 60s today is expected to live to at least 95. Some will go on to see 100. And while that’s something to celebrate, it brings with it a serious financial question:

Will your savings last as long as you do?

In this week’s newsletter, we explore how rising life expectancy is reshaping the way we need to think about pensions, savings, and retirement planning, and how our clients use cash flow forecasting to take control of the decades ahead.

Life Expectancy: The Numbers You Can’t Afford to Ignore

According to the Office for National Statistics (ONS), a 65-year-old man today can expect to live to about 85, and a woman to 88 or 89. But those are just averages. Cohort life expectancy, which accounts for medical improvements over time, projects much higher outcomes. It’s entirely plausible, and increasingly likely, that many people will live well into their 90s.

📌 ONS data shows life expectancy has increased by more than 10 years since the 1950s. And the fastest growth has been in the 70–90 age range.

What this means is that someone retiring at 60 or 65 may need their savings and pensions to support them for 25–35 years - longer than many people’s entire working careers.

Retirement is Lasting Longer. But Are Finances Keeping Up?

Despite living longer, many people still plan for retirement as if it’s a short sprint, not a marathon.

Recent industry research found that most retirees underestimate their own life expectancy - men by around 4 years and women by up to 7 years. The result? Many underestimate how long their money needs to last.

Meanwhile, two in five UK adults are on track to fall short of even basic living standards in retirement, with some households facing income reductions of 60% or more when work stops.

This gap isn’t just about how much people have saved it’s about not knowing how the numbers will play out over time. That’s where proper planning becomes essential.

The Power of Cash Flow Planning

This is exactly why we focus on lifetime cash flow forecasting with our clients at K2 Private Wealth.

It's not just a spreadsheet, it's a personalised roadmap. It helps answer key questions like:

• Can I afford to retire at 60? Or should I wait until 65?

• What if I downsize? Or gift money to my children?

• Will I still have enough at age 85… or 95?

• How does inflation or market volatility affect my long-term plan?

We model out various scenarios - best case, worst case, realistic case - to help clients see into their financial future, with clarity and control.

It’s one of the most powerful exercises we do with clients, and it’s often the moment where things “click.”

Investment Strategy for a Longer Retirement

Planning for a longer life also means thinking differently about how your money is invested.

A retiree who needs their money to last 15 years might be able to stay relatively conservative. But someone planning for 30+ years needs a plan that balances income and long-term growth without taking undue risk.

We often talk about building three "buckets":

1. Immediate income needs - low-risk assets and cash

2. Mid-term stability - diversified, balanced investments

3. Long-term growth - exposure to equities to protect against inflation over 10–20+ years

By aligning your strategy to your life expectancy and goals, you reduce the risk of running out and the temptation to panic during short-term market wobbles.

Planning for the Unexpected: Health, Legacy & Longevity

There’s another side to living longer: not all of those years may be healthy.

In the UK, healthy life expectancy at 65 is around 10–11 years. That leaves a potential decade or more where care, mobility, or lifestyle support may be needed.

This makes later-life planning a crucial part of any retirement strategy:

• Do you want to self-fund potential care needs, or consider insurance?

• Is your estate structured in a way that preserves wealth for your family?

• Are your pension nominations and wills up to date?

With people now retiring earlier, living longer, and facing more complex financial challenges proper planning is no longer a luxury. It’s a necessity.

Ready to See Your Lifetime Plan?

If you’re within 10–15 years of retirement, or already retired and wondering how long your money will last, we’d love to help.

Book a complimentary 30-minute review and we’ll walk through your pensions, savings, and cash flow forecast to show what your financial future could look like and how to shape it in your favour.

A longer life can be a blessing - if you’ve planned for it. With the right financial map, you can make those extra decades some of your best yet.