In recent years, there has been growing conversation about planning for retirement up to age 100, driven by increasing life expectancies. While planning for longevity may seem prudent, new research suggests this could actually be counterproductive for most people. A study in Nature Aging indicates that while average lifespans have increased, the likelihood of most people reaching age 100 remains very low.

Here’s why setting a retirement plan that assumes you’ll live to a century could lead to a range of issues:

1. Unrealistic Expectations

The belief that most of us will live to 100 is rooted in optimism about medical advancements and public health improvements. However, this study shows that only a small fraction of the population is likely to reach that milestone. Currently, survival to age 100 remains low—about 5% for females and 1.8% for males in long-lived populations like Japan and South Korea, and lower still in places like the UK and the United States. Given these low percentages, a retirement plan that assumes a 100-year life may overestimate the actual savings required, creating unnecessary financial stress and unrealistic goals.

2. Life Expectancy Gains are Slowing

The 20th century saw unprecedented increases in life expectancy, largely due to medical and public health breakthroughs. But these gains are decelerating. According to the study, improvements in life expectancy have slowed in recent decades, and the likelihood of achieving "radical life extension" (adding significant years to our lives) is slim without major advances in slowing biological aging. Planning for a retirement that lasts to 100 based on past trends is not supported by current data, making such a plan financially inefficient.

3. Financial Strain of Over-Saving

If you plan for a 100-year life and retire in your 60s, that could mean preparing to fund four decades of retirement. While this may be a reality for some, aiming for such a long retirement may require saving more than is realistically achievable for many people. This can create financial pressure to save excessively, sacrificing quality of life in your working years. A more balanced plan, based on more reasonable life expectancy estimates (in the 80s for most), could provide better financial flexibility and a more comfortable retirement.

4. The Risk of Underspending

Ironically, planning for an ultra-long retirement can backfire if people underspend during their retirement years. Many retirees, fearing they’ll outlive their savings, end up spending far less than they could comfortably afford. This underspending can lead to a diminished quality of life, where retirees forgo travel, hobbies, dining out, or other activities that could enhance their enjoyment of retirement. Planning for an unrealistic lifespan might create an anxiety-driven mindset that focuses on extreme caution at the expense of actually enjoying the wealth built over a lifetime of work.

5. Health vs. Longevity

Planning for a long life often overlooks the reality that while people are living longer, they may not remain in optimal health for all those years. Healthspan—the period of life spent in good health—can differ significantly from lifespan. Many people face health challenges or limitations well before age 100, impacting how they experience retirement. Retirement planning should prioritize both financial security and a comfortable quality of life rather than stretching resources for a potential century-long lifespan.

6. The Emotional Toll of Planning for Extreme Longevity

Planning for an extended lifespan can create an underlying sense of anxiety and fear around money. Constantly worrying about whether you’ve saved "enough" for 100 years can prevent you from feeling secure or enjoying your retirement years. This focus on extreme longevity often shifts attention away from the present, leading to you missing out on meaningful experiences and connections. Building a retirement plan based on more realistic life expectancy projections can help foster a sense of financial confidence and peace, allowing you to enjoy your savings without constant concern about outliving your resources.

Conclusion: Aim for Balance, Not Extremes

While it’s essential to plan for the future and consider the possibility of a long life, it’s just as important to be realistic. Research shows that radical life extension is unlikely to occur for most people in this century. Instead of setting extreme financial goals that may cause unnecessary strain, you should focus on more practical retirement plans that ensure a comfortable and healthy retirement, with provisions for longevity but without over-preparing for a milestone that few will reach.

By focusing on realistic life expectancies, you can feel more confident in using your savings to enhance your quality of life today, rather than holding back out of fear of running out of money. With a balanced, realistic retirement plan, you can enjoy the fruits of your labour without compromising the financial security you may need in your later years.