Are You Financially Prepared for a Longer Life? New Insights on Retirement Planning
By LUCY EVANS, MONEY REPORTER
Updated: 02:00 EST, 6 November 2025
As life expectancy continues to increase, more retirees are facing the possibility of outliving their pension savings. A recent report from Aviva and Age UK reveals startling statistics that underscore the importance of careful retirement planning.
Understanding the Reality: Many Retirees Are Underestimating Their Lifespan
According to the report, nearly one in three retirees in their 70s have surpassed the age they anticipated reaching when they were in their 50s. Furthermore, over three-quarters of people do not believe they will live past the age of 85. This widespread underestimation poses a significant risk for financial security in retirement.
The Statistics Are Alarming
- Life Expectancy for Men: One in four men currently aged 70 is expected to live until 92, with 10% having the potential to reach 96.
- Life Expectancy for Women: For women, the odds are even more favorable, with 5% of 70-year-old women likely to celebrate their 100th birthday.
- Future Expectations: Advances in modern medicine indicate that these odds may further improve over time.
With an increasing number of retirees living beyond the age of 85, it’s critical for savers to reassess their financial plans.
Planning to Retire at 100: What You Need to Know
With the possibility of living until 100, financial planners are now advising clients to prepare for retirement that could span nearly half of their lives. For those retiring at 57—when private pensions become accessible—this means developing a financial strategy robust enough to last for up to 43 years.
Why Financial Advice is Essential
Working with a financial adviser can help create a tailored plan that ensures your savings last through retirement. These professionals can use cash flow forecasting to help determine how much you can spend while maintaining your desired lifestyle.
Consequences of Ignoring Financial Guidance
Failing to seek financial advice can lead to two potential pitfalls:
- Excessive Spending: Without proper planning, retirees may deplete their savings faster than anticipated.
- Excessive Frugality: Conversely, some may live more frugally than necessary, missing out on enjoying their retirement.
Emma Douglas, Aviva’s Wealth Policy Director, highlights the importance of making informed financial decisions. She asserts that mid-retirees should be cautious about assumptions regarding their life expectancy.
Effective Retirement Strategies
Tax Relief: A Hidden Boost to Savings
One useful tool is pension tax relief, which can significantly lighten the burden of saving for a long retirement. Higher-rate taxpayers, in particular, should ensure they claim tax relief on their contributions.
Here’s how it works:
- Basic-rate taxpayers: Every £80 saved into a pension is topped up to £100 by the taxman.
- Higher-rate taxpayers: A contribution of £60 gets boosted to £100.
- Additional-rate taxpayers: Contributions of £55 will similarly increase to £100.
Withdrawals: Choosing the Right Strategy
A financial adviser can guide you on the best method for accessing your pension. Options include:
- Drawdown: Withdraw funds as you need them.
- Annuities: Guarantees regular income throughout retirement.
Annuities may offer peace of mind by providing stability in income, particularly if they are inflation-linked, though they may come at a higher cost.
Planning Ahead: Use of Annuity Calculators
Consider using an annuity calculator to gauge what your savings may produce in terms of regular payments during retirement.
Final Thoughts: Are You Prepared for a Century-Long Life?
As many retirees now live much longer than they expected, it’s vital to rethink your retirement strategy. Start discussing your plans with a financial adviser to ensure you’re not only preserving your assets but also enjoying your golden years to the fullest.
Ensuring a financially secure retirement means preparing for a longer life. The choices you make today can be profoundly impactful on your quality of life in the future. Be proactive—talk to the right professionals and prepare for the unexpected length of your retirement years.
