“Death, Finances and How Many of Us Get Our Money Needs Wrong,” by Josh Zumbrun, Wall Street Journal
“The good news is that many Americans live a lot longer than they expect. The bad news is that this often leads to financial regret as they realize, sometimes too late, they might have claimed Social Security too early, passed up the opportunity to buy annuities or long-term-care insurance, or simply undersaved for all those added years of retirement. Demographers and actuaries make the following distinction between life expectancy and longevity: Life expectancy refers to the average number of years someone will live from a given age, whereas longevity refers to how long he or she might live if everything goes well, typically expressed as the probability of living beyond a certain age such as 85, 90 or even 100. A growing body of evidence shows that many people are ignorant of their so-called longevity risk—the probability of living a very long time—and the complications that presents.” (Emphasis added.)
LTC Comment, Stephen A. Moses, President, Center for Long-Term Care Reform:
The longer people live the higher the probability that long-term care will catch up with them. Therefore, most aging Americans should focus on longevity risk rather than life expectancy when considering LTC insurance. LTCI producers should emphasize this distinction in their sales and marketing. It is made clearly and persuasively in this article. If you have access to the Wall Street Journal, check it out today. If not, I can forward a limited number of copies to Center members from our subscription. Just ask.
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