Longevity Report by RBC Wealth Management reveals how 45-75 year olds in London are redefining their Third Quarter

Longevity is fundamentally reshaping the way we live. We have quietly undergone one of the biggest social transformations in modern history. We’ve added decades to our lives, but many of our ideas about education, work, retirement and ageing still belong to another era. For generations, life followed a relatively predictable pattern. We learned, we worked, we retired. However, as life expectancy rises and retirement horizons extend, the traditional life model of learn, work and retire is no longer fit for purpose.

RBC Wealth Management’s Longevity Report explored the ambitions and personal goals of individuals in their third quarter of life, those aged 45 – 75. In London around one in seven (15%) of people believe they were quite likely to live to 100 years old.

Not only did those in London feel they were going to live long lives, but they were also optimistic about their future with 62% of individuals feeling optimistic about what their third quarter holds.

The research also revealed a clear link between health, wealth and purpose with 73% of respondents from London feeling that financial security makes it easier to prioritise health and 58% of people in the capital agreeing that having a clear sense of purpose motivates them to stay financially disciplined.

However, just 35% of those in London said they had a clear financial plan for retirement, 26% had clear plans for health and wellbeing and 20% for maintaining a sense of purpose.

The research also showed that a health scare or change in health was a key trigger point for re-evaluating financial priorities with 38% reviewing plans as a result.

Kevin Jennings, Senior Director, Regional Centre Head for London and the South East, RBC Brewin Dolphin, London comments: “What stands out from this research is just how positive people in London feel about growing older, three quarters of Londoners feel younger than their actual age and 62% are positive about the future. That optimism is a powerful starting point, but it needs to be matched with action. Right now, just 35% have a clear financial roadmap for retirement, and even fewer have thought through how they’ll protect their health or stay purposeful. Living longer is a gift, but only if we prepare for it. A plan that brings financial planning, physical wellbeing and a sense of meaning into the same conversation, started early enough, is what turns extra years into genuinely fulfilling ones rather than simply longer ones.”

Top five proactive planning tips for your Third Quarter to ensure your finances can help you realise your personal goals

Tackling the awkward conversations: put wills and powers of attorney in place early to ensure your wishes are protected, reduce uncertainty and worry – helping you feel more secure and able to focus on fulfilling your goals and passions.
Visualising your goals: Put everything on one page (pictorial or written) to understand what you can control, can’t control yet, and can’t control at all – so you can focus on “what can I do now?”
Protect your earning capacity: by reviewing insurance cover to safeguard against illness, disability, or death and ensuring continuity of your financial plan.
Review your pension statements: review retirement plans regularly to ensure they continue to work towards your future goals and match your risk appetite. Failure to engage can mean default outcomes, rather than tailored drawdown or investment strategies.
Explore alternative investment options for building a holistic retirement plan: by having a diverse range of structures in which you hold investments, including having cash reserves in place, you can reduce your risk exposure and build a tax efficient retirement pot.
o Consider investing via your ISA to maximise tax efficient savings and investments. You can save and invest up to £20,000 a year within your ISA wrapper. Although from next year for savers under 65, the annual Cash ISA subscription limit drops from £20,000 to £12,000. The overall £20,000 ISA limit remains, meaning at least £8,000 must go into a non-cash wrapper.

o Investing in international bonds can be another way to complement other retirement structures, owing to their flexibility and potential tax advantages.