Save, Invest or Die

I stumbled upon an article the other day that manages to be quite right and quite wrong about the future of your life, insofar as finance and health go:

"As the first wave of America's 77 million baby boomers head into retirement this year, it becomes more critical for Americans to seriously evaluate how they will maintain their lifestyles as we live well into our 80s, 90s and beyond," said Stinson, president of Genworth's long-term care insurance business. "It's good news that the typical steep gains in nursing home costs have moderated this year. But the fact remains that most American households remain unprotected from the costly health challenges that come with greater longevity."

The poll also revealed most individuals recognized the need to prepare for the cost of long-term care, but were largely unprepared.

Many Americans surveyed also wrongly believed they had insurance protection, felt that their savings would be adequate to cover long-term care costs, and incorrectly believed that Medicare would cover long-term care costs.

The article is written assuming no change - all too common a fallacy these days, sadly - and that the world will proceed forward with the medical technology of the year 2006, or at least nothing much more advanced than that. Nothing could be further from the truth; even the least optimistic amongst scientists and realists are looking to large gains in healthy life span and ever less disability amongst the elderly in the years ahead.

Still, you must save and invest, or die. Harsh, but true. You will not be saving for nursing homes, however, or other equally unappetizing twilight scenarios of decay and suffering. Rather, you will be saving to afford the first and second generations of working anti-aging medicine; therapies and technologies capable of repairing age-related damage and extending your healthy life span. These will not be cheap at first, but even modest savings can net very large gains over a lifetime of diversified investment. You will need those funds. Folk have a way of believing that governments can create something from nothing, but governments are not magical entities capable of flouting basic economic truths. You shouldn't count on other people's taxes funding your healthy life extension - that way is the way to death and poverty for all. There is no free lunch, and certainly no free medicine; if you want to live healthily for longer, you will have to make sensible decisions now and work for it.

If you are forward-looking enough to support healthy life extension - in effect to make a better life for the you that will exist decades from now - then you are forward-looking enough to invest in ensuring that the future is as you would like it to be. A part of that is saving for yourself, but it is also vital to help fund present day efforts aimed at ensuring that healthy life extension technologies are developed. How you decide on that split is up to you; you will need to arrive in the future as a financially secure individual, but it doesn't matter how financially secure you are if working anti-aging therapies were not developed in time.

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