With average life expectancy continuing to grow, savers must take this into consideration when planning for retirement, the industry has warned.
Figures from the Office for National Statistics showed the average life expectancy in the UK in 2017 to 2019 was 79.4 years for males and 83.1 years for females, an increase of 6.3 weeks and 7.3 weeks respectively when compared to 2016 to 2018.
But these figures do not include the impact of Covid-19, which will be shown in next year’s annual statistics.
Stephen Lowe, communications director at Just Group, said as savers are continuing to live longer, this needs to be considered when planning for retirement and ensuring that people have saved enough throughout their lives.
Mr Lowe said: “Individuals need to think carefully about the sustainability of their income streams in later life and how to structure their finances to take account of physical and mental decline.
“Of course, these figures don’t yet include the impact of this year’s coronavirus pandemic and the wider, long-term effect it may have on the nation’s health.
“But longer lives are still showing up in sharp rises in the number of people reaching greater ages. There were more than 600,000 people in the UK aged 90 and over in 2019, a record rise of 3.6 per cent compared to the previous year.
“Financial planning for retirement needs to take account of the rising odds of people reaching these advanced ages. That applies particularly to women who, at age 90 plus, outnumber men by two to one although the gap is narrowing.”
Meanwhile Tom Selby, senior analyst at AJ Bell, said savers must take into account other factors which affect life expectancy when it comes to retirement planning, for example where they live.
He said: “It is worth noting that while overall life expectancy might have been improving, how long you can expect to live depends heavily on a variety of factors, including where you live.
“For example, the gap between the region with the highest average life expectancy at birth, Westminster, and the region with the lowest life expectancy, Blackpool, was over 10 years.
“More generally, there remains a clear disparity between the life expectancies of people living in London and the South East and less affluent regions such as the Midlands and the North East.”