Long-term Investing: 3 Mistakes to Avoid

With medical advances meaning we are all living longer, would-be centenarians should hold more stocks and seriously research annuity options, among other strategies

Christine Benz 12 May, 2014 | 11:42AM
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A few years ago I attended the 100th birthday party for a family friend. Following a round of toasts and tributes, this never-married, lap-swimming centenarian treated her admirers to a rousing song-and-dance rendition of "Yankee Doodle Dandy." And she wasn't alone on the dais: Her older sister, a former member of the Women's Army Corps, joined her.

These two are the only 100-year-olds I know, but they're not all that unusual any more. In fact, the number of centenarians in developed countries is increasing at a rate of more than 5% per year. At that pace, the population of individuals aged 100-plus will double every 13 years, according to the United Nations' World Population Ageing Report.

Of course, it's still a fairly small subset of the population that will live that long – scare tactics from insurers and other financial-services providers notwithstanding. Just 5% of 65-year-old females and 3% of 65-year-old males in the US will make it to age 100, according to Social Security actuarial estimates. But a much larger percentage - 29% of 65-year-old males and 39% of 65-year-old females – are expected to live to age 90.

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About Author

Christine Benz

Christine Benz  is director of personal finance at Morningstar and author of 30-Minute Money Solutions: A Step-by-Step Guide to Managing Your Finances.

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