What decisions would you alter from your past?

Dominic Thomas
August 2024  •  3 min read

What decisions would you alter from your past?

The appearance of Michael J Fox on the Pyramid stage at Glastonbury with Coldplay was a reminder of the need to savour the moments that we have.

For those who don’t know, Michael J Fox has had a successful career in film and television, most notably for his performance as Marty McFly in the Back to the Future movies. He has since revealed his battle with Parkinson’s disease which has had an increasingly debilitating effect.

In the original movie, teenager Marty McFly travels in time from 1985 to 1955 and meets his parents when they were at High School. The difference in fashion, attitudes and culture in just three decades made for good entertainment.  Today it is now longer since the film was released than the time travel that Marty experienced, nearly a decade longer! As with most time travelling fantasies, the lesson learned is that a change in the timeline will likely lead to different outcomes.

Aporia is yet another film on the topic, but rather than travel back, time is bent to change the past. Malcolm’s sudden death as a result of a drunk driver leaves Sophie widowed and struggling to make ends meet, their daughter Riley is becoming increasingly disinterested in school or friends. Malcolm’s friend seems to have done the impossible in his spare room and invented a working Time Machine. Sophie (despite having seen Back to the Future!) decides to interrupt the time continuum with the hope of preventing the fatal accident.

I am sorry to say that my pedantic self took over as events unfold, I immediately thought, why don’t you now take out a decent level of life assurance! This is your warning, you have seen how difficult life can be when tragedy strikes and a lack of funds merely compounds the difficulty. Whist money does not compensate for the loss of a loved one, it certainly helps survivors to cope and continue.

No, it’s not terribly romantic of me is it! But then my view is that romance is for the living. Early in my career there was a well-known training film about the impact of death on a family. Its aim was to highlight the importance of life assurance and the relieving of stress on a widow… which of course had the agenda of getting me (and every other adviser) to sell more life assurance.

Over the years I have worked with many people who have lost a loved one. Some were far better prepared than others and some were not prepared at all. We get constant reminders that life is short and death is inevitable; yet most of us avoid thinking through the consequences of our death on the families and businesses we may leave behind.

It’s time to change that. You can take action today, there are not as many tomorrows as you think.

What decisions would you alter from your past?2024-08-09T15:23:59+01:00

Life Expectancy Assumptions

Born Before 1962? under-estimating life expectancy may be…. fatal?

If you were born before 1962 there is mixed news, according to a report by the National Association of Pension Funds (NAPF). This is a rather concerning but important report. In essence most people over 50 years old today are under-estimating how long they will live whilst being over-optimistic about how well off they will be in retirement. This of course on the face of it is a fairly disastrous mix. That said, I have to say that I’m rather wary when contemplating reports that suggest forecasts are accurate (which is the fundamental flaw within the report). Whilst clients will testify to my rather unusual approach of discussing life expectancy at a fairly early stage of the financial planning process, it is important that you understand the implications. However, to pretend or suggest that the future is predictable in this way is really rather silly. We use life expectancy as a guide, nothing more. In reality our assumptions ought to be reviewed annually, because of a very strange quirk of life called “mortality drag” which is the statistical notion that the longer you live, the longer you will live. Strange but true. Great financial planning when all is said and done, means making your money last a bit longer than you.

Start with the end in mind

The report suggests that people in their 50’s underestimate life expectancy, though to my mind the data is somewhat open to interpretation. The most important finding was that 59% of people surveyed (aged 50-64) had not given thought to how long they might live. The ONS 2010 figures should be applied carefully and based on current age. They are also based upon statistics of people that have already died having lived a long life. So it would be reasonable to assume that thanks to those wonderful people at the NHS that we are all kept going a little longer and if we live a healthy lifestyle, perhaps longer still. However the principle is quite right in planning life, but this needs to be done with the knowledge that any such forecast will be wrong. It is a guide and nothing more. All life expectancy data is historical and can be used for is to identify national historical averages.

Born in 1961 or earlier

So for those born in 1961 such as Lloyd Cole, Peter Beardsley, George Clooney, Tim Roth, Enya, Heather Locklear, Michael J Fox, Meera Syal and Meg Ryan (who all became 51 in 2012) the UK ONS statisticians would cite historical data that for those born in the UK and living there the men have an average of 29.73 years left and the women have another 32.96 years.  However, as we all know, this is no way to plan a life, indeed one might suggest that it is utterly silly. Well, I would largely agree, but for good financial planning it is helpful to at least put some sensible parameters in place that we review each year.

Life Expectancy Assumptions2023-12-01T12:23:19+00:00
Go to Top