Over the last 150 years, best practice life expectancy has increased at the rate of two to three years every decade - a child born today has more than 50% chance of living significantly beyond 100 (107 in Japan, 104 in US, 103 in UK).
The challenge is that the social structures of time, and especially the three-stage life of education, work and retirement, are based on a much shorter life expectancy. Those who live to 100 rather than 70, have around 100,000 extra productive hours. One thing is certain – a significant proportion of those extra hours will be spent working. Given even optimistic assumptions about savings rates, it is likely that those currently in their mid 40s will be working until their early 70s, and those in their early 20s into their late 70s and possibly 80s.
Whilst an elongated working stage takes care of finances, long lives need significant investment in intangible assets . Over a non-stop working career of 60 years, productivity will inevitably dwindle as skills become out-dated; mental and physical health will decline; and relationships will become less intense.
We believe that people will respond by morphing from a three-stage life to a multi-stage life with several distinct stages to their careers and clear transitions in between. Some of these stages will be focused on accumulating financial assets; others will achieve a better work/life balance. Investment in intangible assets will be crucial: putting time aside to remain healthy and investing in vitality assets; developing strong supportive relationships; going back to fulltime education to reduce the possibility of skill obsolesce. Longer lives means being younger for longer and this ‘juvenescence’ will be crucial to navigating these different stages, and not becoming trapped by past habits and persona.
Just as past increases in longevity resulted in the emergence of new stages of life (teenagers and retirees) so new stages and ages are emerging. In longer lives options become more valuable, and so new patterns of behaviour from those in their 20s are emerging as they delay the traditional commitments of marriage, children and house buying. They are using their extra years to explore, or start a business as an independent producer. Those in their 50’s are exploring their options, so whilst divorce rates are declining in general, they are rising for those over 50 and rising fastest for those in their 80s. ‘Hard stop’ retirement is disappearing as people build portfolios for work, go back to school – explore the world – right now 1 in 8 Americans over 70 is still working.
There is no doubt that these changes will accumulate further in the decades ahead and will dramatically affect every aspect of life – economic, social, financial and corporate. Understanding this will decide whether longer lives are a gift rather than a curse.
This restructuring of social conventions will raise demanding questions of corporates and governments, especially around growing inequalities in life expectancy. However we are on average living for longer and are healthier for longer and if we can successfully redefine the structure of our lives then we can ensure we reap the benefits of growing longevity.