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Betting on longevity

By Jennie L. Phipps · Bankrate.com
Sunday, January 26, 2014
Posted: 6 am ET

Are you basing your estimate of your own longevity on how long your parents lived?

A new study using data from people between the ages of 50 and 61 by economists from the Center for Retirement Research at Boston College found that to be a common -- but not always very accurate -- yardstick.

Researchers discovered that as people watched their parents live to 75, 80 or beyond, they pushed out their own retirement planning commensurately. The study also found that the opposite could happen. Watching their parents die at a younger-than-expected age often pushed an individual toward earlier retirement.

For example, when a man thought he had a 70 percent chance of living at least to age 75, he kept working until he was 64. If he thought he had a less than a 50 percent chance of living that long, he was likely to retire four months earlier than his peers.

Researchers pointed out that gut-level math isn't -- in general -- very accurate. Longevity increases over time. On average, a 65-year-old man today can expect to live to age 84. Thirty years ago, men at age 65 were expected to live until age 80. Women's life spans are even longer.

That said, another -- unrelated -- study by the Center for Retirement Research found that two major habits could have an impact on how long we live -- smoking and obesity. The study referred to projections by the Social Security Administration in 2005 that predicted gains in life expectancy at age 40 of about 2.6 years for men and 2.2 years for women between 2010 and 2040. But the center's calculations suggest that if you smoke, you'll only enjoy about half those gains in life expectancy, and if you're fat, you lose one-third of them. If you're both a smoker and an eater, it looks like you could wipe out most potential gain.

One thing is certain: Predicting how long you'll live is a very inexact science, but erring on the optimistic side is smart.

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