Add Category
‘Harness the benefits’
One of them, titled “On the Limits of Chronological Age,” looks at the diverse ways that the ageing process affects physiological capacities. It finds that many aspects of economic behaviour, like readiness to join the labor force, may not be well captured by people’s calendar age – even though that’s what policies such as statutory retirement are typically based on.
By continuing to rely on chronological age as a proxy for how well people can function, societies may end up failing to “fully harness the benefits of increasing longevity,” the researchers from Harvard and the London Business School conclude.
The AI was trained on a dataset of more than 1200 life expectancy studies with some 53 million participants.Credit: Internet
Another working paper examined the “value per statistical life” or VSL – a callous-sounding measure that’s used for cost-benefit analysis in areas like regulation of pollution or compensation for workplace accidents. It’s typically calculated based on compensation for workers in high-risk jobs.
Loading
The researchers behind the NBER study The value of Statistical Life for Seniors drew on a different dataset: the propensity of older Americans to spend money on medical services that reduce mortality risk. They found a mean VSL at age 67 of just under $US2 million ($3.1 million) for people reporting their health as “excellent,” compared with $US600,000 for those in “good” health.
When it comes to personal finances, better measures of life expectancy will have profound implications for people saving for retirement, according to Ryan Zabrowski, a financial planner with investment advisory firm Krilogy.
“A huge concern for elderly people, our retirees, is outliving their money,” says Zabrowski, who touches on the issue in his soon-to-be-released book, Time Ahead.
‘Out the window’
Decisions such as how much to save and how fast to withdraw assets are often based on broad-brush and unreliable averages for life expectancy. AI-driven tests that can potentially reduce that uncertainty are largely unheard-of now, but likely won’t be such an unusual idea in the future.
What’s more, the AI technology itself along with advances in medicine has the potential to boost life expectancy — and with it the risk of running out of savings. Zabrowski reckons one consequence is clear: longer retirements will mean savers need higher-return investments for their old age, which will push them to allocate more stocks over fixed-income securities.
“The conventional method of measuring demand for equities will be thrown out the window,” he writes his forthcoming book. As people start expecting to live longer, there will be a “massive escalation in demand for equities.”
There are plenty of technologies already out there — like heart-rate monitors and maximal oxygen-consumption gauges from wearables — that have the potential, in tandem with new AI-powered devices, to reduce the uncertainty around personal mortality.
Of course, there’ll always be limits. On top of entirely unpredictable variables, like accidents or even pandemics, there are plenty of intangibles.
Longevity gap
Loneliness, for instance, is often reckoned to reduce life expectancy. Gratitude may increase it. A Harvard study found that women who reported feeling the most grateful had a 9 per cent lower risk of dying within three years than those who reported feeling the least.
Life expectancy is key to all kinds of financial and economic calculations, by governments, companies and individuals – from retirement income needs, to policy coverage at life insurance and pension funds, and financial planning.
Then there’s the question of inequality. For life expectancy, money matters. Multiple studies – including the work of Nobel prize-winning economist Angus Deaton on Deaths of Despair — have found a clear gap between rich and poor Americans.
Loading
Research published by the American Medical Association found the longevity gap between the wealthiest and poorest 1 per cent, at age 40, was nearly 15 years for men and 10 for women.
For Death Clock users, who have to pay $US40 a year to subscribe, the app suggests lifestyle changes that can hold mortality at bay – along with a second-by-second countdown of estimated time remaining.
“There’s probably not a more important date in your life than the day that you’re going to die,” Franson says.
Bloomberg
Get news and reviews on technology, gadgets and gaming in our Technology newsletter every Friday. Sign up here.