One of the great success stories of the last century has been improvements in life expectancy.
In 1900 in Britain, life expectancy at birth was about 47 for a man and about 50 for a woman. Fast forward to 2018, and life expectancy has improved dramatically; to 79 years for men and nearly 83 years for women.
But can these improvements to life expectancy continue forever?
In the past few years, official data around life expectancy has prompted an interesting debate. Life expectancy improvements have been slowing and the cause of this slowdown has been contested by experts. New figures published by the ONS in August will add to the debate as they show that life expectancy in the UK has stopped improving for the first time since 1982, when figures began.
According to the ONS, life expectancy at birth in the UK did not improve in 2015 to 2017. It remained at 79.2 years for males and 82.9 years for females.
Looking at the specific regions within the UK, life expectancy at birth actually declined by 0.1 years in 2015 to 2017 for males and females in Scotland and Wales. The same applied to males in Northern Ireland.
What about for those already retired?
Another useful measure, especially for retirement planning purposes, is to consider life expectancy at age 65. These new figures show life expectancy at age 65 years in the UK did not improve for males and females in 2015 to 2017. It stayed at 18.6 years for males and 20.9 years for females. A quick calculation shows that if you reach 65 your life expectancy improves – for men it becomes almost 84 and for women, 86.
Sophie Sanders, Centre for Ageing and Demography, Office for National Statistics, said: “The slowdown in life expectancy improvements in the UK has continued, as 2015 to 2017 saw the lowest improvements in life expectancy since the start of the series in 1980 to 1982.
“This slowing in improvements is reflected in the chances of surviving to age 90 years from birth, which has also seen virtually no improvement since 2012 to 2014.”
Two main factors influence the slow down
So following decades of life expectancy improvements, what factors could be causing it to grind to a halt now?
According to some work carried out by The King’s Fund last year, two factors which contribute to the life expectancy slowdown are largely uncontested.
- One factor is the result of changes in mortality among older people. Put simply, more older people – particularly older women – than expected given historical trends are dying.
- Another undisputed factor contributing to the life expectancy slowdown is that flu contributed to excess deaths in some years, notably 2015 and also in 2017. However, the scale of this contribution is still being debated.
Beyond these two factors, views about the underlying factors are hotly contested. Some have put forward the impact of austerity measures as a contributing factor, which includes cuts to NHS funding.
Commenting on the latest official figures, Alistair McQueen, Head of Savings & Retirement at Aviva said: “Despite today’s stall in life expectancy, we are still set to live longer than ever before. We must prepare for this future, by readying ourselves for a longer working life and by thinking about how we will support ourselves financially for longer.”
The role of retirement planning
Life expectancy is a key consideration when planning for retirement. We will continue to adjust our long term planning assumptions accordingly and factor these into each review of your financial plan. That way, we will always be planning for your best case scenario.