Today’s healthiest and wealthiest retirees are eight times more likely to live to 100 than the poorest and least healthy

The number of telegrams sent by the British Monarch to 100 year olds has risen from 24 in 1917 to nearly 7,000 today. It is projected that the number of centenarians (people who live to 100 years old and beyond) will continue to skyrocket by more than 10 fold over the next 30 years¹ (when the NHS will also celebrate its 100 birthday). This growth is due to the higher birth rate between the first and second world wars and dramatic improvements in health and healthcare.

But the picture across our population is far from uniform. UK average life expectancy is now 81, but this masks huge disparities with the wealthiest households expected to live 20 years longer than those in the most deprived areas.

Consider two groups of one thousand 65 year old men starting to draw their state pensions today in different parts of the country. Of 1000 high affluence men living in the leafy avenues of Kingston-upon-Thames, 38 are expected to survive to their 100th birthdays. Contrast that with 1000 low affluence men in Kingston-upon-Hull, where this would only happen to 4 men. In other words, the healthiest and wealthiest men in our society are around 8 times more likely to live to 100 than the poorest and least healthy.

Whilst women typically live longer than men, their gap is also about 8 times, with the number of survivors to 100 varying from 8 up to 60 from each group of 1000 pensioners.

The wide range of chances of surviving to 100 is a symptom of the different paces of biological ageing across our society, which is believed to be largely explained by the healthiness of lifestyles, rather than the physical environment or the genes we are born with.

What does longevity inequality mean for public policy?

Worryingly, public policy has failed to keep pace with improvements in longevity. Club Vita, the experts in longevity analysis, have looked at the impact of more people living for longer on social care costs, state pension costs and on our expectations for ‘retirement’:

Social care costs for elderly

• Over the short term, government spending on social care is to rise from £8.34bn in 2015/16 to £9.99bn in 2020/21. In other words, an ageing population will make social care costs rise by at least 4% p.a. more than inflation over the next 5 years;
• Looking further into the future this is likely to be much higher.

State pension costs

• We’d be collecting our pension at age 74 if the state pension age had kept pace with improvements in longevity since it was set at 65 in 1948;
• Instead, today the UK government spends £100bn a year on state pension. This is expected to double in next 20 years and double again the 20 years after that;
• This underscores the need to commit to the changes suggested by John Cridland in his recent review of State Pension Age, and to bring forward the increase to 68 between 2037 and 2039.

Retirement

• Baby boomers have invented a new age of ‘retirementhood’ - but this is under serious threat;
• We’re reaching a tipping point for retired household income due to the shift from Defined Benefit (DB) to Defined Contribution (DC) pensions, which are much less generous. Analysis from Hymans Robertson shows that three quarters of UK workers are not saving enough to secure an adequate retirement income. So longer retirements will become even less affordable.
• This underscores the need to commit to a range of saving, behavioural and work life changes in order for future generations to have the better retirements they want.

Commenting, Douglas Anderson, Founder of Club Vita, said: “While we should celebrate that more of us are living to ripe old age, the issues of dealing with an ageing population have been kicked down the road by successive governments. We’re already seeing a social care crisis unfold. Unfortunately, there will be even more pain in the years to come unless bolder action is taken. But with Brexit looming large, it’s hard to see how the Government will find the bandwidth to tackle these issues. And even if it did, given any measures would be politically unpopular, the political will is unlikely to be there.

“Given the reality of longer lives, there are a number of urgent priorities we need to tackle as a nation. First, we need a stable long term savings platform. With proper long-term leadership from government, rather than continual tinkering, individuals and their employers could be encouraged to save more. That requires stability in the system, which has been woefully lacking.

“Second, we need to prepare for and better support longer working lives. We need to do more to help individuals live healthy lifestyles, so that they are able to work longer and to help mitigate costs of remedial medical work by the NHS. As a society we also need to be prepared to work for longer and to retire when we can afford to. We also need to encourage life-long learning to ensure people have new and economically useful skills in the face of ever more jobs being automated.

“Third, we need to plan for significant additional public funding for social care for the elderly. The rise in demand that we are now starting to see, has been quite predictable for over 30 years. Individuals and the private sector can play a role in the solution, if the commitment of the public sector is well understood and there is confidence in its durability.

“Fourth, we need to provide better support around the financial decisions people need to make in the transition to ‘retirement’. Leaving the labour market too early, or spending pensions too quickly as a result of freedom and choice, can lead to years of regret. It would be much better to find new roles where individuals can work part time for a while than to be forced into a new job after several years or more in retirement. This will make much better use of their skills.

“Fifth, we also need to prepare for a future where not only our muscles but also our brains can be replaced by machines.”

Asking if we can we realistically expect Government to tackle all of this, especially given Brexit, he added:

“Arguably it is completely unrealistic to expect Government to take meaningful steps to solving these issues. But when we look to the future the burden on future generations looks too heavy. So, we should ask, is now is the time to create a separate independent commission to tackle the following issues: long term savings, long term care, long term financial independence and dealing with automation – all of which require a view that stretches beyond political time horizons?”