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The Methuselah Problem

Over the course of the 20th century, life expectancy at birth in the U.S. increased more than 27 years, from just over 49 to nearly 77. Recent scientific discoveries offer the promise that, in this century, lifespans may be made even longer and, perhaps more importantly, that the deterioration and diseases of old age may be kept at bay.

This is good news, of course.

But it is also an early warning of personal and societal challenges ahead. Some people, like myself, who ponder these issues call it the Methuselah Problem.

As a financial planner, I deal regularly with the personal aspect. Most people want to ensure that their money will last the rest of their lives. Deciding how much is enough requires us to consider many variables, including the future movements of investment and housing markets, the person’s spending, and just how long the person’s life is likely to be.

Currently, the average 65-year-old American man can expect to live to about 81, and the average 65-year-old woman can expect to live to about 85. Some financial planners simply assume that their clients will fall, more or less, within these averages. The problem, however, is that relying on averages means failing to provide enough support for those whose lifespans reach the upper end of the spectrum. When I talk to clients, I encourage them to consider the possibility of living to age 90, 95 or beyond.

That, however, still doesn’t take into account the chance that major medical breakthroughs may arrive in the next few decades. For younger people, especially those just beginning to save for retirement, the possibility of significant changes in life expectancies is even higher.

Of course, a longer lifespan doesn’t have to mean a longer period of retirement. Many of the same things that have extended lives have also made our golden years healthier and more productive. Already, since the mid-1990s, the average retirement ages for men and women have risen, from 62 and 60 to 64 and 62, respectively, according to analysis of Census Bureau data by the Center for Retirement Research at Boston College.

But while longer careers may provide a solution for personal financial considerations, the prospect of an older workforce raises a number of larger questions.

In business, shifts to new leadership often bring about innovations, as younger leaders re-examine old methods. If a 65-year-old CEO fails to depart, however, that impetus for change is lost. As I have written before, Japanese businesses’ tendency to shelter older employees, while leaving younger workers with few opportunities to lead, has already contributed to a decline in new ideas from the country.

Beyond business success, the generational changing of the guard provides an important engine for social progress. New ideas tend to take hold first among the young, gaining traction as those people gain influence. It is possible that, if a large segment of people who grew up before World War II were still active in business and government, we would not have made nearly as much progress in combating institutional forms of racism and sexism.

With luck, as today’s generation of young people take the helm, we will see efforts toward equality for same-sex couples take off. Among those ages 18 to 30, 59 percent support same-sex marriage, compared to only 46 percent of the population as whole. The longer people live and participate in civic life, however, the longer it will take for generational newcomers to tip the balance.

I am all for scientific and medical progress. Spending more time on this world with the people we love is about all anyone could ask for, leaving aside any religious beliefs about what may come next. Longer, healthier and more vigorous life is a good thing.

But good things rarely come without a price. While we are investigating new methods of extending life, we should also spend some time thinking about how we’re going to pay that price, before all of us get to be old as Methuselah.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book, Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us,” and Chapter 4, “The Family Business.” Larry was also among the authors of the firm’s book The High Achiever’s Guide To Wealth.

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