The Rich Are Betting On Living to 100

(Bloomberg) -- Money might not buy love, but it can buy better health. And, to live as long as possible, the world's wealthy are willing to pay up. 

Over the past few decades, the average person's lifespan has risen almost everywhere in the world. In China, the U.S. and most of Eastern Europe, the average life expectancy at birth has reached the late 70s, according to the Organization for Economic Cooperation and Development, or OECD. People in Western Europe and Japan, meanwhile, can expect to live into their early 80s. 

Most rich people, however, are counting on living even longer—a lot longer, as in two decades more than average. In a new UBS Financial Services survey, 53 percent of wealthy investors said they expected to live to 100.

Hitting triple digits won't be easy, but it's not as outlandish as it used to be. The average Japanese woman now has a life expectancy of 87, OECD data show, compared with 81 years for men. And many studies have shown that the wealthy have a built-in longevity advantage.

In the U.S., for example, the richest 1 percent of American women by income live more than 10 years longer than the poorest 1 percent, a 2016 study in the Journal of the American Medical Association found. For men, the gap between the richest and poorest Americans is almost 15 years. 

The rich also seem to know that living to 100 is a pricey prospect, one that requires more spending on health care, better food, exercise and other services that can lengthen life. Also, you have to keep paying for everything that comes from hanging around additional decades. In the UBS survey, which focused on people with more than $1 million in investable assets, 91 percent said they're “making financial changes due to increased life expectancy.” Even the wealthy worry about rising health-care costs, the survey suggests.

The rich are more than willing to sacrifice money for extra longevity. Nine of 10 wealthy people agreed that “health is more important than wealth.” Asked by UBS how much of their fortune they'd be willing to give up “to guarantee an extra 10 years of healthy life,” the average responses varied by wealth level. Investors who are barely millionaires, with $1 million to $2 million in net worth, were willing to give up a third of their nest egg for an additional decade of life. Investors with more than $50 million were willing to part with almost half of their fortune.

The world's trend toward longer life has featured an exception in recent years—the U.S. The life expectancy of Americans has declined for two years in a row, an anomaly that can be blamed in part on the country's opioid abuse crisis. But even before U.S. lifespans started slipping because of drug use, health and longevity statistics significantly lagged those of other wealthy countries in Western Europe and Asia.

Perhaps it's not surprising, then, that rich Americans surveyed by UBS had different attitudes from the wealthy elsewhere in the world—they were more pessimistic about making it to age 100. Just 30 percent of the American rich expect to hit the century mark. While they were the most worried about rising health-care costs, they were the least likely to be adjusting their finances for the prospect of living longer.

If rich Americans aren't planning for the extra costs of longevity, they could be making a mistake. Studies show that the wealthy in the U.S. are increasingly insulated from the depressing health trends afflicting most Americans. A 2016 study by University of California at Berkeley professors Emmanuel Saez and Gabriel Zucman compared the death rates for American men aged 65 to 79 across several decades by wealth. If these men's wealth placed them in the top 1 percent, their mortality rates in the early 1980s were 12 percent lower than average. Twenty-five years later, the wealthiest American men's death rates had plunged to 40 percent below average.

Rising inequality is about more than just a widening gap in wealth and income. The richest Americans are also living much longer, healthier lives than everyone else. 

To contact the author of this story: Ben Steverman in New York at bsteverman@bloomberg.net.

To contact the editor responsible for this story: David Rovella at drovella@bloomberg.net.

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