A 100-Year Life Deserves a New Retirement Plan

Retirement plans should carry you through the ebbs and flows of a life well-lived. 

In generations past, you worked for decades (maybe even at the same company) and retired at age 65. This is no longer sustainable.

Given that life expectancy was lower and medicine was less sophisticated back then, it made more sense. But now with people living longer than ever, the traditional retirement model is not only out of date, but out of touch. For longevity[lon-jev-i-tee]nounLiving a long life; influenced by genetics, environment, and lifestyle.Learn MoreClose-minded individuals aiming for the 100-year mark, retirement must be reimagined. 

Why the Old Retirement Playbook Doesn’t Work Anymore 

The Social Security Administration (SSA), which launched in 1935, originally set the retirement age at 65. Since then, this age has steadily increased and depends on the year you were born. For those born in 1960 and later, the full retirement age is now 67. The current life expectancy is 78.4 years for both sexes, according to the Centers for Disease Control and Prevention (CDC). While that may be the average, the number of people living to 100 years old is growing.

That means you have a longer time period to plan for, so that your assets live as long as you do. However, the financial practicalities are also quite different now than they were in the past. Pensions were more common. Now, as of March 2024, only 15 percent of private industry workers have access to a pension, according to the U.S. Bureau of Labor Statistics (BLS). 

Retirement plans like the 401(k) are more accessible, but saving for the future largely falls on individuals. Social Security is still available as well, though questions remain about its funding in the future. 

Aside from these factors, inflation has continued to lower consumer purchasing power. Technology and AI are accelerating and stand to change the landscape of work. 

Before, retirement was treated like a destination. You put in your time for decades and could potentially collect a pension. After years of service, you could reclaim your time and really start living. In today’s world, the old model no longer holds up. 

A New Retirement Model for a 100-Year Life

If you’re planning to live a 100-year life, taking care of your mind, body, and money is essential. To prepare for many more decades, retiring from all work at 67 may not make a whole lot of sense. Instead, think of your financial life stages as waves and not a single arc. You can earn, pause, take a sabbatical, earn again, explore, and reframe. 

Reimagining retirement means optimizing for possibility. The old retirement was a final stage to reach. The new retirement is balancing your time, work, energy, and money for a fulfilling and purpose-driven life. 

“It’s no longer a marathon of a career. It’s sprinting and walking. It’s interval training. You’re going to sprint hard for three to five years, and then you need to take a period of rest, whether that’s three months or six months, to find that motivation, that creativity, especially as AI gets better at being a machine,” said Jillian Johnsrud, author of Retire Often. “Humans need to get better at being human so that you can show up at that next job refreshed, creative, motivated, with the energy to do this next sprint.”

Flexible Retirement Planning 

Navigating a new retirement plan requires flexibility, consistency, and planning for the different periods of your life. 

1) Have Two Money Pots 

Instead of one pot of money for retirement, Johnsrud suggests that people have two pots with different purposes. 

“In my book, I encourage people to think about their retirement monies in two pots, an old-age money, which is what you’ll utilize when you’re no longer capable of working, but also an in-between pot that you can use as needed in varying percentages throughout your working career to take sabbaticals, maybe start businesses, to switch jobs when you’re in a toxic work environment,” said Johnsrud.

2) Rethink the 4% Rule 

If you want to ensure your money lasts, the 4% rule is a popular benchmark. If you stick to it, you’ll likely have enough for a 30-year retirement. 

“The most common rule of thumb people hear about is the 4% withdrawal rate in retirement. This rule was created in the early 1990s, but now, with advancements in medicine and education on healthy lifestyles, we need to rethink this rule,” said Jordan Vlastuin, a certified financial planner at Make the Memory Financial Planning. 

Preparing for a 100-year life that has a longer retirement period may require some adjustments and flexibility. 

“A better way to look at spending in retirement is through a guardrails approach. This approach requires more flexibility in your spending, but it significantly reduces the risk of running out of money at an old age. The guardrails approach creates years of increased spending when the portfolio is growing, and reduced spending when the portfolio is declining,” said Vlastuin. 

3) Earn, Pause, Reset 

A reimagined retirement plan allows you to earn, pause, and reset based on your energy, goals, and finances. 

“I expect to see the rise of the Guardrail Worker. When markets are down, this person returns to work part-time or consults to avoid selling depressed assets. As needs are met, work will shift toward meaning and self-actualization. Entrepreneurship can also act as longevity insurance. Owning a consulting practice allows older adults to control their income stream longer and bypass ageism,” said Marcel Miu, a certified financial planner and the founder of Simplify Wealth Planning.

Plus, working can keep your cognitive skills sharp, your body active, and keep you socially engaged. 

4) Contribute to Your Retirement Plans 

You might have access to an employer-sponsored 401(k). But are you taking advantage of it? “One of the biggest opportunities missed is not putting enough into your retirement plans. Make sure to take advantage of the full contributions and the catch-up contributions in the later years if possible,” said Vlastuin.

You can now contribute up to $24,500 to your 401(k) in 2026. IRA contribution limits are $7,500 for 2026. For those 50 and up, you can make catch-up contributions of $8,000 to your 401(k). Employees 60-63 have a higher additional catch-up contribution of $11,250.

5) Maintain Liquidity 

Even if you do contribute up to the 401(k) limit, it can be a good idea to maintain liquidity elsewhere as well. 

“The biggest gap I see is liquidity. People save heavily in tax-advantaged accounts like 401(k)s, but are liquidity poor in middle age. For a 100-year life, you need a War Chest or Security Bucket. This is roughly 5 to 7 years of income in safe investments to weather prolonged bear markets without touching stocks,” said Miu.

The Future Plan

Old retirement models no longer align with today’s reality, or the potential of living a very long and fulfilling life. Reimagining a new retirement gives you the chance to start and stop work as needed, to pivot based on your dreams, and live life to the fullest in every decade. All while prioritizing your health and wellness. 

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