How Much Do You Need for Retirement If You Live to Age 100?

Editor's Note: This story originally appeared on NewRetirement.

We all ask the question, “How much do I need for retirement?”

It is a very hard question to answer. The difficulty lies in the fact that it varies greatly depending on how long you live.

Will you live to be 100 or 85? How long will your spouse live?

First, let’s look at the bad news and good news about living to 100.

The Bad News About Living to 100

The bad news? Life expectancy in the United States has fallen over the last two years.

The Organization for Economic Cooperation and Development (OECD) found that life expectancy in the U.S. has decreased 1.6 years — the most of any country studied.

In many European countries, the average person lives to be 80 years or more. The U.S. has never exceeded 79 years of life expectancy.

And life expectancy is worse by several years for people of color.

The Good News About Living to 100

The good news? You have a very good chance of living a long time. And, the additional life expectancy for Americans who reach age 65 has remained relatively constant.

• Men who reach age 65 can expect, on average to live another 17 years to 82 years old.
• Women who reach 65 will live, on average, almost another 20 years to 85.

More bad news? If you are lucky enough to live a long time, it is important to keep in mind that those long lives cost more – a lot more.

When you retire at 65 and live until age 100, you are retired for 35 years. That is only 10 years less than the 45 years you might have spent working. Have you saved enough?

What Percentage of the Population Lives to 100?

Well. The overall chances of living to 100 aren’t actually that great. According to the World Economic Forum, there are over 500,000 centenarians among the 7.9 billion people worldwide.

That means that only a 0.006% of the population is 100 or more.

Here are a few additional facts from the most recently available information from the Society of Actuaries and the Social Security Administration:

• One out of three males and one out of two females who are in their mid-50s today will live to be 90.
• For a couple who is 65 today, there is a 50% chance that one person will be alive at 92.
• If you have lived to be 65, you will likely live another 20 years, on average.
• If you live to be 75, the average life expectancy is 88.
• If you live to be 85, the average life expectancy is 92.
• And, if you live to be 95, the average life expectancy is 98.

What Is the Chance YOU Will Live to 100?

Statistics are not your own reality. If you are wondering whether or not you will live to be 100, Caring.com suggests a few clues that predict longevity. Here is a sampling:

• You have lots of very old family members.
• You are spry and can walk fast and far.
• You are a woman. (There are approximately 100,000 100-year-olds in the United States. Around 85% percent of them are women. Only 15% are men.)
• You are social and engaged in your community.

Some people use life expectancy calculators to try to determine how long they will live. While there is absolutely no guarantee of accuracy, check out the best life expectancy calculators.

How Much Do You Need If You Do Live To Be 100?

Even if you knew that you would live to be 100, the answer to the question of how much you need for retirement is still tricky to answer.

It all depends on how much you spend, if those expenses change over time, if you have expensive health issues, how much of your retirement income is guaranteed for life, etc.

Perhaps the best way to figure out how much more you will need if you live to be 100 versus 85 is to use a retirement calculator that lets you change your longevity.

The NewRetirement Planner shows you your expected life expectancy based on your age.

How Can You Possibly Create a Secure Retirement Plan That Gets You to 100?

It may sound impossible, but affording a long life is doable. Here are a few tips if you fund life until you are 100.

Delay Social Security

Barring a government meltdown, Social Security income does not dry up. The real value of your Social Security benefits is that you will continue to get them no matter how long you live.

The longer you wait to claim benefits, the bigger your monthly Social Security check will be. If you wait until at least your full retirement age (around 66), your check will be about 30% larger than if you started at 62.

And, delaying until 70 gets you benefits that are 75% higher.

So, if you expect to live till 100, it is best to delay the start of your benefits to really maximize your monthly income.

Work Longer

If you work longer, either by delaying retirement or with some kind of retirement job, you will be able to afford to live longer.

And, research suggests that working is one of the factors that can help you achieve a longer life.

Consider Ways to Guarantee Your Income

Annuities are controversial, but if you are worried about living to 100 and the possibility of running out of money, an annuity might be a great option for you.

Adequate guaranteed lifetime income is the key to paying for a long life.

A lifetime annuity is like a pension that you buy for yourself. In exchange for a lump sum of money, you get monthly income that is paid for as long as you live – no matter how long that is.

Evaluate Tapping Home Equity

If you own your home, it is likely your most valuable asset. Home equity is becoming an increasingly popular way to fund long lives.

As part of planning your retirement, you should explore how you could release your home equity and whether or not the money can fund a retirement where you live to be 100.

Explore reverse mortgages, downsizing, home equity loans and more.

Be Flexible

Retirement planning requires a give and take between what you want now and what you will need in the future. You don’t want to spend all of your assets in the first 10 years of retirement.

However, you don’t want to over-economize and get to 85 or 100 wishing that you had spent a little more.

You might want to live large when you first retire, then slow down and spend less, and then maybe really gear down and spend very little when you hit 85.

Just be prepared for costs to skyrocket near the end of your life to cover medical expenses.