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Here's How Long the CDC Expects Your Clients to Live Now

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U.S. clients ages 25 and older are still missing 2.6% of the years of life they had to live in 2019, before the COVID-19 pandemic began.

Clients ages 65 and older are still missing 3.6% of their pre-pandemic life expectancy.

The National Vital Statistics System, an arm of the U.S. Centers or Disease Control and Prevention, has shown how COVID-19 itself, the damage the pandemic did to society and the health care system, and, possibly, other factors have affected your clients’ store of time on earth in its latest provisional life expectancy estimates report.

Overall life expectancy at birth increased to 77.5 years in 2022, from 76.4 years in 2021, thanks to a decrease in the number of people dying of COVID-19. But life expectancy at birth is still 1.3 years lower than it was in 2019, according to a comparison with the provisional table for 2021 and the final numbers for 2019.

For a look at how the pandemic has affected the estimated life expectancy of clients at nine different ages, see the gallery accompanying this article.

What it means: The final CDC life expectancy numbers sit at the heart of all retirement planning in the United States.

They feed into the models that Social Security and Medicare program managers use to set program benefit levels and other parameters; the models that the U.S. Treasury Department uses to set parameters for pension plans and retirement income tax exclusions; and the financial forecasting tools used by agents and advisors.

Lingering uncertainty about life expectancy means that clients may be paying more for annuities than they should be, getting lower Social Security benefits than they should be and spending less than they could.

For a 65-year-old New York couple with an annual income of $100,000, a 3.6% positive error in life expectancy estimates could mean that the couple will miss out on enough income each year to pay for an all-inclusive, four-night trip to Las Vegas, including a stay in the Luxor, according to a package deal price estimate from Expedia.

The numbers: Factors such as sex, race, ethnicity, location, education, income, wealth and insured status can have a big effect on clients’ actual life expectancy.

The CDC breaks its new numbers down by age, race and ethnicity, but not by state of residence or socioeconomic indicators.

Teams of actuaries are now gathering and analyzing the data to improve life expectancy estimates for the kinds of relatively well-educated, high-income, conscientious people who tend to use the services of financial professionals.

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