Plan sponsors take note: The life expectancy of a typical 65-year-old male worker in an industrial corporation has increased 11/4 years during the past six years, a Buck Consultants Inc. study shows. He can now expect to live until age 83.
For a typical 65-year-old female, the corresponding life expectancy increase was 91/2 months; her expected life span now extends to nearly age 87.
"For many public and private organizations, pension plan costs will eventually increase to reflect the longer lifetime over which pension payments will be made. A longer life expectancy will also have serious implications for the long-term costs of Social Security and Medicare benefits," Henry Anderson, consulting actuary, said in a statement.
The study showed overall increases in life expectancies for both men and women of all ages. The improvement was greater for men, a trend Buck first observed in the late 1970s.
In the last 20 years, the life expectancy of a 65-year-old man has increased 24% - or 31/2 years; a woman's corresponding increase was 14% - or 21/2 years.
Nevertheless women still can expect to significantly outlive men.
Buck's previous study, from 1983 to 1987, showed active working females with no overall mortality improvement. The current study, covering 1988 to 1993, shows a 2% per year improvement.
Buck also has developed an hourly mortality table for males that is applicable for valuing hourly pension plans. The 1995 table indicates hourly male workers die sooner than all other males.
