Would you change how you deal with your finances if you knew the exact date you were going to die?
I would and I’m sure you would, too.
Unfortunately, no one knows when they will die, so you must plan for your best guess of your future.
How Many Years You Probably Have Left To Live
I came across this crazy website that tells you, through an awesome visualization, how many years you probably have left to live.
Basically, you input your gender and your age and it runs probabilities over and over again, dropping a ball at the age you would theoretically die.
After it runs for about 100 to 1,000 times, you’ll start to see a pattern for how likely it is you will die within a range of years. For instance, you may have a 1% chance of dying in 0 to 9 years, 2% in 10 to 19 years, 10% in 20 to 29 years, 20% in 30 to 49 years and 77% chance of living over 50 years from today.
If you want to see results faster, make sure to click fast mode. You can even leave the tab running in the background and come back later if you want a more statistically relevant sample.
The Results May Change Your Planning
If you weren’t realistic with your personal estimate of your life expectancy before you ran the simulation, the results may have shocked you.
Granted, these are super generic results, but it gives you a better idea than if you were just completely winging your estimates. Your results from the simulation may say you’ll live much longer than you expected or much shorter than you expected. The real question is what will you do with that information.
Not Saving For Retirement?
If the results are realistic for your personal life situation, then you need to seriously take a look at your financial plans and see if they fit the reality.
If you were relying on working until you die and your life expectancy says you could easily live into your 90s, do you really think you’ll still want to work until you die? I doubt it.
Instead of continuing down the path of saving nothing for retirement, start saving today. Even if you just save a little bit, you can continue to build on that momentum until you’re saving a realistic amount of money.
Are You A Super Saver?
On the other end of the spectrum, you could be a super saver that assumes you’ll live to 100. While you may very well live to 100, the simulation I ran didn’t give me a very good chance of reaching that goal.
If you’re sacrificing now to make sure you won’t run out of money until you’re 110, you may want to dial back your savings rate to enjoy life more now.
These Are All Statistics – You Could Be The Outlier
While the simulations that are run are all based in probabilities, you have to remember you are a single dot on the simulation. You could be the person that dies in 9 years or you could be the person that lives to 105.
You need to plan for a reasonable lifetime. Don’t use this as an excuse to not save for retirement because the simulation told you there is a 20% chance you’ll never make it to full retirement age.
At the same time, use this as a wake up call. There may be a 20% chance you won’t make it to retirement age. Make sure you’re living life to the fullest and enjoying at least a little bit of your money now.
Yes, saving for retirement is smart because there may be an 80% chance you’ll get there. Just make sure you aren’t solely living to retire or you may miss out on life.
One last thing… Don’t make knee jerk reactions. Make sure to talk to your financial advisor before changing any plans you make already have. Only you and your advisor know your whole situation.
Did this simulation change the way you think about saving for retirement? Did it cause you to save more for retirement? Did it make you sit back and think about living life a bit more now? Let me know in the comments below.