[#18] The New World You're Ageing Into
Why the Planning Horizon You're Using Is Probably Too Short
There’s a particular kind of moment that seems to arrive somewhere in your mid-fifties-or-sixties. It’s quiet. It doesn’t announce itself. But if you’ve been there, you’ll recognise it immediately.
It sounds something like this:
Have I got enough?
Is what I’ve built actually going to last?
Or will the money run out in the distant future — when I’m too old to earn it again?
And then, not long after:
Am I missing opportunities? I’m not going to get a second chance at this.
These are the questions of someone who has built something real and wants to protect it. Someone who’s watched people close to them make mistakes they’d rather not repeat. Someone who doesn’t want to end up being forced to ‘live small’, or make a mistake and ‘blow up’ their nest egg.
The quest
And so starts the big quest. It looks different for everyone.
For some it’s research — articles, podcasts, the occasional book. For others it’s numbers on a spreadsheet at ten o’clock on a Sunday night. It’s the search for the missing information, the missing relationship, the missing piece that will finally make the whole picture fall into place.
The effort is genuine. The intention is serious. But here’s what most people don’t say out loud:
The cost of not getting this resolved is real. And it gets worse over time.
Three creeping costs
The first cost is time. Every hour spent searching for the answer — reading, researching, running numbers — is a sunk cost you can’t recover. The older I get, the more I feel the weight of that. Time is that one, precious resource that – once you spend it – you don’t get it back. It’s gone forever.
The second cost is opportunity. The decisions that didn’t get made while the quest was still underway. The windows that opened and quietly closed. Markets moved. Structures changed. Tax positions shifted. Some of those moments were recoverable. Some weren’t. A single projected line isn’t a plan. It’s a best-case scenario dressed up as one — and by the time you discover the difference, the moment has usually passed.
The third cost is probably the heaviest: the emotional weight of carrying this unresolved. It doesn’t arrive as a crisis. It’s slower than that — a low-grade hum of financial anxiety that sits just below the surface of daily life. It gets heavier gradually, silently, without announcing itself. And it takes up space that should rightfully be occupied by something far more valuable and uplifting.
More often than not the quest stalls. Why? The blame game’s usual suspects are: didn’t try hard enough, or didn’t meet the right adviser yet, or ‘it’s complex’. All of these might be true but they’re rarely the whole truth.
The actual reason is hiding in plain sight.
A three-dimensional problem
Einstein — and I’m paraphrasing here — said that you cannot solve a new problem with the thinking that created it. The retirement planning question most people are wrestling with isn’t a one-dimensional numbers problem. It’s a three-dimensional thinking problem.
So the old thinking, however diligently applied, keeps producing the same unsatisfying result: a projection that feels reassuring on paper and fragile in the middle of the night.
The old thinking asks: how much do I have, and what return does it need to generate? That’s a reasonable question for the world our parents retired into. It produces a number, a line on a chart, a figure that advances tidily from left to right and arrives intact at some nominated finish line.
The new world doesn’t work like that. Lifespans are longer and less predictable than the models assumed. Healthspans — the years of genuine functional vitality, the period during which wealth is actually used — are extending in ways that compress the decline at the end but stretch everything before it. Markets are more volatile. The variables have multiplied. A single projected line isn’t a plan.
New thinking asks a different question: will it last – whatever happens?
That question has three dimensions.
Lifespan — not a fixed number, but a range. And if you’re in your late fifties with good health, good income, and good access to medical care, your range almost certainly extends further than the figure you’ve been planning to. The actuarial data is unambiguous on this: people like you live longer than the population average, often significantly. Planning to the average when you’re above it is one of the quieter ways a retirement plan fails.
Healthspan — the quality of life within those years. This is where your own choices carry real weight. The science is clear that lifestyle — exercise, diet, sleep, stress management — plays a decisive role in determining not just how long you live but how well. You can’t control everything, but you’re not passive either. The gap between lifespan and healthspan — the years of decline before the end — is narrowing for people who attend to it. More years of the life you’ve designed. Which is, incidentally, more expensive than the declining-years model ever assumed.
WealthSpan — how long your wealth can sustain both. This is the dimension where your decisions are not merely influential but decisive. Lifespan and healthspan are partly biology, partly the choices you make about how you live. WealthSpan is different: it responds directly to how you plan, structure, and stress-test your financial life against the range of outcomes that reality might actually deliver. It’s the variable that closes the gap — or doesn’t.
A poor WealthSpan outcome almost never announces itself in advance. It accumulates quietly, through small structural fragilities — a planning horizon that’s too short, a drawdown rate that works at the median but not at the tail, a sequence of events that no straight-line forecast anticipated. The plan looked fine. It just wasn’t built for the world its owner was actually ageing into.
That’s fixable. But only once you’ve seen the bigger picture.
A six-minute exercise worth doing
A strong place to start is to get a strong sense for the ‘lifespan’ dimension -- how long your money needs to last. If you’d like to see your own numbers, not the population average, this is an exercise worth doing.
There’s a free ‘Lifespan Calculator’ published by a group of actuaries called Optimum Pensions. It will give you a personalised planning horizon: a range that takes your health profile, lifestyle, and partner into account rather than treating you as an average Australian.
I have no commercial relationship with Optimum Pensions — this is simply the best tool I’ve found for this specific purpose, and in my estimation the actuaries who built it understand this problem very well.
Find out how long your money needs to last.
The WealthSpan Letter is general financial information, not personal financial advice. Consider whether any information is appropriate to your circumstances before acting on it.