Plan to live to 100 when creating your retirement plan

The beautiful thing about aging is we’re living longer, experiencing more of life. There are more happy and healthy centenarians than ever before (triple the number in Canada since 2000), and if that trend continues, you might hit that mark, too. 
But as costs rise and medical advances progress, retirees and soon-to-bes are questioning if their money will last. 
These days I’m guiding most people to extend their financial plan time frame until age 100, and make shifts to their assumptions around the cost of living. Here’s why.
The majority of plans I see are set to make the person’s money last until age 90. But centenarians are the fastest-growing age group in Canada. My grandmother is turning 102 this week and is still living independently. My other grandmother recently passed away only weeks before her 101st birthday. 
And though it appears inflation is quelling, living costs are going to continue to rise.
If you previously set out a financial plan (that’s your cue to get one done if you haven’t yet done so with a financial planner), it’s time to revisit it. Consider these areas carefully.
“What if” thinking is extremely helpful in building flexibility into your plan for retirement.
What if you lived until 100? What if you want to travel more when you’re in your younger retirement years? What if your health is amazing (or not so amazing)? What if you had the opportunity to continue to work (maybe even part-time) until age 70 or 75? What if you need more money than you have? What if you do/don’t give money to your kids? What if you want to live independently at home vs. a care community? What if you completely rethink your budget to prioritize saving again? Is downsizing the right thing? Or even upsizing — maybe your kids are moving home?
Book a meeting with your financial planner or money coach
They’ll flag any gaps between your current (or expected) sources of income in retirement, the pace at which you’re spending, and what you’ll need to preserve for those later years. These professionals can also be quite creative with potential solutions to remedy the gaps. I’ve gone so far as to recommend lucrative side hustles for some of my retired clients, who’ve filled their wallets and built beautiful social connections at the same time. 
Your insurance, will and power of attorney will be reviewed in this process, and tweaks suggested, such as shifting insurance coverage, adding backup executors (what if you outlive the ones you’ve listed) and more.
Your adviser will help you with this part, but let’s say you do live an extra 10 years, and require long-term care the majority of that time. Does your plan allow for those costs? My advice is to plan for at least a mid-level version of long-term care, and for at least twice as long as you may have originally accounted for. These costs show no signs of slowing, and despite financially supportive government programs for aging in place, that option is costly. There are only good things that can come from doing early research on your future care requirements, and reflecting those estimates in your plans.
Make the necessary changes to your budget today
Reliable indexed pension or investment income, RRIF withdrawals, CPP, OAS and other sources of income: if you’re planning for a longer life, and greater care costs, you might need to shift aspects of spending, and savings habits, today so that your money will last longer. 
Your adviser might recommend starting to save again by socking away money every month in a TFSA or HISA. The amount you were planning to spend on travel or gardening or moving might need to shift. Calculations of the impact of downsizing as an option to shore up your nest egg can and should be run, and reflected in your budget.
Following a budget template will be extremely helpful in staying on track with your spending so that you can preserve your nest egg. Pick any kind, ensure you like it and can stick with it.
As you build this refreshed budget, a great planner will also tell you point blank if you’re spending too much (or too little), and suggest changes to your budget. More advisers are now focusing on behavioural shifts to support you in developing better financial habits for the rest of your life. That might be a great conversation to start having.
The financial impacts of aging are a family affair. Adult children are almost always trying to understand how ready for retirement you are, what your wishes are when you die, and nowadays to see if there’s any flexibility to help them with buying a home or supporting grandchildren with post-secondary costs, etc. They don’t view the latter as rude, btw; with extremely high costs, and incomes that are not keeping up, asking for financial help is commonplace. 
My advice is to shed some light on your situation, particularly if you might need their help down the road. That gives them an opportunity to plan, too.