Retirement Planning Insights
employed septuagenarians working with older clients
The concept of retirement has evolved significantly over the years. While traditional retirement often meant clients completely stepping away from work by their early to mid-60s, today’s reality is quite different. Many septuagenarians—individuals in their 70s—continue to work, whether out of financial necessity, personal fulfillment, or a desire to remain engaged in their professions.
For financial professionals, assisting these older clients requires a nuanced approach. These individuals have unique considerations, including a shorter life expectancy, existing Medicare and Social Security benefits, the tax challenge of RMDs, concerns about long-term care, and the growing risk of diminished capacity. Understanding these individuals’ financial and personal priorities is essential to providing guidance that helps them navigate their retirement years with confidence.
Shorter Human Capital and Life Expectancy: Planning for the Years Ahead
One of the key factors in retirement planning for septuagenarians is their comparatively limited time horizon. Unlike younger clients, whose financial plans may span several decades, older workers have a shorter time horizon in retirement. This means financial advisors must focus on helping the client utilize what they have for income rather than seek to accumulate more for retirement.
Further, simply because of their age, these individuals’ ability to continue working, in other words their human capital, is reduced. Even if they “ride a desk” for a living, once they are in their 70s, they must recognize that their working potential is limited. Either their own health, or that of a loved one, may require them to step away from active employment in the near future.
A common concern for this age group is whether they have sufficient savings to support themselves through their remaining years, particularly if they need to retire sooner than expected. Some may have been so confident in their ability to work that they have not been good savers. Advisors should assess their client’s financial situation and adjust retirement plans accordingly, ensuring that income sources align with their needs while also taking potential health challenges into account.
Medicare and Social Security: Maximizing Benefits
Most septuagenarians have already signed up for Medicare and Social Security, two essential pillars of retirement planning. However, even if they are receiving benefits, there are still considerations regarding how best to utilize these programs.
Medicare
Since Medicare becomes available at age 65, most employed septuagenarians already have coverage. If the client still receives medical insurance through their employer, advisors should assess whether the client has also enrolled in any Medicare programs, such as Medicare Part A, which is free. Further, they should prepare the client for the transition from their employer’s healthcare plan to Medicare once they leave work. The individual has a limited time after leaving employment to sign up for the other Medicare programs without incurring a lifetime penalty.
Social Security
Individuals in their 70s are presumably already collecting Social Security benefits. They should prepare for the fact that when they go on Medicare for their health insurance coverage, their Medicare premiums will be deducted from their Social Security payments. This could impact their cash flow if they’re used to having health insurance premiums withheld by their employer from their pay.
If the client has been on Medicare while working, a possible positive cash flow effect may be that leaving employment will lessen their exposure to higher Medicare premiums due to IRMMA, the income related monthly Medicare adjustment. Without wages coming in, the retired septuagenarian may actually end up paying less for Medicare, and that means less coming out of their Social Security payments.
Required Minimum Distributions (RMDs): Managing Withdrawals and Taxes
For employed septuagenarians, RMDs pose an additional financial consideration. By age 73, individuals must begin withdrawing minimum amounts from certain tax-deferred retirement accounts, including traditional IRAs and 401(k)s. These mandatory withdrawals can significantly affect both cash flow and tax liabilities, and financial advisors must help clients navigate these implications. There are two major planning considerations when they turn age 73. First, they can defer taking RMDs until April 1 of the year following turning age 73, but that has the effect of requiring them to take two RMDs in the same year – potentially raising their income tax liability in that year. The second issue is whether they want to use any of the strategies available to either delay or avoid RMDs.
How RMDs Impact Cash Flow
While continued employment may provide steady income, RMDs can suddenly introduce additional liquid assets into a client's financial picture. If the client does not need the funds for immediate living expenses, advisors should first explore whether some of the RMDs can be delayed because of the “still-working” exception that applies to the retirement funds in their employer’s plan. This delays RMDs for at least some of their funds. For the remaining funds that are subject to RMDs, reinvestment strategies should be considered to maintain tax efficiency while optimizing the use of the RMD withdrawals.
Tax Implications
RMDs are fully taxable as ordinary income. This income can also expose them to additional Medicare premiums because of the IRMAA rules. However, there are some key strategies to mitigate RMD-generated tax liabilities. These include:
- Qualified Charitable Distributions (QCDs) — Individuals can donate up to $108,000 (in 2025) each year directly from their IRA to a qualified charity, reducing taxable income.
- Qualified Longevity Annuity Contracts (QLACs) — Individuals can invest part of their qualified funds and IRAs into a deferred income annuity that will begin payments later in life (as late as age 85). An advantage of this approach is that RMDs on these funds are deferred until the annuity begins paying out.
- Tax-Efficient Investment Planning — Consider using RMD funds to invest in tax-advantaged accounts, such as Roth IRAs (if eligible) or low-tax investments.
- Strategic Withdrawals — For clients with multiple retirement accounts, prioritizing withdrawals from different sources can help manage tax exposure.
Proactively addressing RMDs within a broader retirement plan ensures that clients do not experience unintended tax burdens while continuing to work.
Long-Term Care Needs: Preparing for the Future
One of the most pressing concerns for older clients is the cost of long-term care. As individuals age, the likelihood of needing assistance—whether in-home care, assisted living, or a nursing facility—rises significantly. Long-term care can be expensive, and without proper planning, it can quickly deplete savings. Options to address this risk include:
- Long-Term Care Insurance — If the client has a policy in place, advisors should review the terms and ensure the client fully understands the benefits. If they do not have coverage, it may be challenging to obtain a policy due to age or pre-existing conditions.
- Hybrid Policies — Some life insurance policies and annuities offer long-term care riders, allowing clients to tap into their death benefits for care expenses while living.
- Self-Funding Strategies — Clients with sufficient assets may opt to set aside a portion of their savings specifically for care needs, utilizing strategies such as annuities, trusts, or liquid reserves. They may also choose housing that allows them to transition, such as a Continuous Care Retirement Community (CCRC).
- Medicaid Planning — As an option of last resort, advisors should explore Medicaid eligibility for long-term care benefits. This benefit is income and needs based, so it should only be used as a backstop if other funding sources aren’t available.
Planning for these expenses should be approached carefully to ensure that resources are allocated appropriately while maintaining financial independence.
Risk of Diminished Capacity: Safeguarding Financial Well-Being
As individuals age, there is an increased risk of cognitive decline, which could impact their ability to both continue their employment and manage their finances. Financial professionals should proactively discuss trust planning, powers of attorney, and guardianship arrangements to ensure that their clients' interests remain protected. Actionable steps include:
- Powers of Attorney — Encouraging clients to designate trusted individuals to manage both their health and financial decisions in case they become unable to do so themselves.
- Living Will/Advance Directive — Ensuring clients have legal documents outlining their medical preferences in the event of an emergency.
- Trust Planning — A trust may provide maximum flexibility in defining when the individual is no longer legally competent, and how finances will be handled at that point.
- Estate Plan Review — Regularly updating wills and beneficiary designations to avoid complications later on.
- Fraud Protection — Older individuals are often targeted by financial scams. Advisors should educate clients about common fraud schemes and help implement safeguards in advance to protect their assets.
By addressing these concerns early, the client is in a better position to continue working as long as they desire. Planning provides peace of mind that they will have financial security if something goes wrong.
While employed septuagenarians may differ in their motivations for remaining in the workforce, they all share common concerns about life expectancy, healthcare, long-term care, and cognitive decline. And they want to make the right financial decisions that help maximize their income and tax planning. Advisors who take the time to assess their clients’ needs, optimize benefits, and prepare for potential challenges can help older workers transition smoothly into retirement.
More From The College
- Get our retirement planning checklist for your clients.
- Learn more about the Retirement Income Certified Professional® (RICP®) program.
- Browse other courses and programs available.
Retirement Planning On-Demand Webcasts
Turning Tax Challenges into Maximum Client Value
As tax legislation approaches a critical juncture, it’s important for financial professionals to employ expert tax planning strategies to maximize client outcomes before new IRS regulations and expiring low tax rates can interfere.
Join America’s IRA expert Ed Slott, CPA for a timely discussion of maximizing retirement and tax planning opportunities in 2025 and beyond, including tips for capitalizing on historically low tax rates and an overview of Setting Every Community Up for Retirement Enhancement (SECURE) Act and SECURE 2.0 Act changes, new IRS regulations, and more.
Plus, hear from IRA analysts Andy Ives, CFP®, AIF® and Ian Berger, JD for answers to all your questions!
This on-demand webcast is only available in Knowledge Hub+. Knowledge Hub+ is a robust, just-in-time learning platform delivering over 80 hours of on-demand CFP Board-approved CE by leading academics, practitioners, and thought leaders. Learn more about Knowledge Hub+ and subscribe today! College designees can access Knowledge Hub+ as a benefit of the Professional Recertification Program without having to subscribe via My Learning Hub.
Presenter
Ed Slott, CPA
Professor of Practice, The American College of Financial Services
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Moderators
Andy Ives, CFP®, AIF®
IRA Analyst, Ed Slott and Company, LLC
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Ian Berger, JD
IRA Analyst, Ed Slott and Company, LLC
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About The College Insights
2025 Soldier Citizen Award Recipient
The Center for Military and Veterans Affairs has named the recipient of the 11th annual Soldier-Citizen Award, Vice Admiral James Zortman, USN (Ret.). Vice Admiral Zortman will be honored with the award at the Military Summit on September 18, 2025.
Military Background
Throughout his 34 years of service in the Navy, Vice Admiral Zortman commanded at every level with distinction. He oversaw the Naval Air Forces of the Pacific and Atlantic Fleets as well as the U.S. Carrier Task Forces during Operation Enduring Freedom, displaying incredible and impactful leadership. In his final assignment, he served as commander of all Naval Air Forces — encompassing more than 180,000 service members and a fleet of 3,800 aircraft and 12 aircraft carriers — with a focus on operations, readiness, and the lifecycle management of naval aviation assets.
For his exceptional service, Vice Admiral Zortman was awarded the Defense Superior Service Medal, the Legion of Merit (four times), the Bronze Star, the Air Medal, and the Distinguished Service Medal, the Armed Forces third-highest medal.
Civilian Leadership
Since retiring from the Navy, Vice Admiral Zortman has continued to lead in the private sector, having served as senior vice president at Northrop Grumman Aerospace, a member of the strategic advisory board of Airbus U.S. Space and Defense, Inc., Chairman of the Board for the San Diego Regional Economic Development Corp., and Chairman of the Naval Aviation Museum Foundation. Currently, he holds positions as Chairman of the Board for USAA and executive coach and senior advisor at Boston Consulting Group, where he leverages his innate leadership skills to empower the financial security of the military community.
Vice Admiral Zortman embodies what it means to be a soldier-citizen, having exhibited strong leadership and expertise throughout his time in both the Navy and civic life. In recognition of his achievements and capabilities, he has received the NACD Directorship 100 recognition for excellence in innovation, courage, and integrity as well as the Herb Klein Award for outstanding civic leadership in addressing challenges throughout San Diego.
Vice Admiral Zortman will be honored as the Soldier-Citizen Award recipient at the Center for Military and Veterans Affairs and Center Founding Partner and Sponsor Penn Mutual’s annual Military Summit on September 18 at the Bellevue Hotel and the National Constitution Center in Philadelphia.
More From The College
- Register for the 2025 Military Summit
- Learn more about the Center for Military and Veterans Affairs
Retirement Planning Research
Retirement Longevity Planning Expert Perspective
This fact was made clear in a recent research report by our experts and the Nationwide Retirement Institute, “Planning for a Century of Living.” The report, aptly named due to its headlining conclusion that the number of Americans living to age 100 or older could quadruple by 2054, provides powerful insights in the areas of retirement longevity planning and retirement income security — namely, that financial professionals and organizations need to adjust their retirement planning mindset to take into account rising longevity figures.
What’s more, the report found clients lack a sufficient understanding of how long they may live, which can negatively impact their retirement income security. In a survey of individuals in or nearing optimal retirement age, the report confirms a fundamental truth of retirement longevity planning revealed in our 2023 Retirement Income Literacy Study: your potential clients are unprepared for increased longevity — and that can put their future in jeopardy.
Our own Michael Finke, PhD, CFP®, one of the experts who contributed to the research, outlined his high-level conclusions from the report.
Don’t want to wait for the summary? Dive into the full report and download it now!
The Latest on Retirement Longevity Planning
While there are differences in the data between higher and lower-income households, one consistent through-line is clear: those who lack understanding of how long they may live are putting themselves at risk. According to Finke, only 27% of those surveyed in the study were able to correctly estimate the average longevity of a 65-year-old at retirement; 67% underestimated it. He points out this lack of knowledge has real impacts: those who underestimate longevity are 35% less likely to take retirement longevity planning into account and plan for spending into at least their 90s.
This understanding is critically important because research shows Americans are living longer: one-third of average-income couples and one-half of higher-income couples who reach retirement age will then have one spouse live to age 95 or beyond, as Finke explains.
In addition, failure rates for the classic “4% rule” of retirement longevity planning, in which clients are advised to stick to a 4% withdrawal of assets each year of retirement, rise by over 40% when retirement longevity planning horizons increase by just five years (from 30 to 35). And that’s assuming things go well — when using lower-than-average 10-year U.S. stock and bond returns, that failure rate increases by over 300%: a serious red flag.
“Too many people underestimate how long they’ll live — and that blind spot can seriously undermine their financial security,” Finke says.
Ensuring Retirement Income Security
So how can financial professionals ensure retirement income security as they speak with their clients about retirement longevity planning? Finke says the research shows knowledge is power, which can translate into real financial returns.
One way your clients can compensate for difficult financial conditions and buy themselves more time to save for retirement is simply delaying that retirement. This decision seems to be becoming more widespread: in fact, 76% of recent survey-takers said they planned to delay their retirement due to market volatility and fears of higher inflation.
There’s also some good news from the report, Finke says: proof that taking retirement longevity planning into account can improve outcomes. Workers who believe they have an 80% chance of living to age 75 are 88% more likely to save at least 10% of their income for retirement — making maintaining retirement income security a far better possibility — than those who have lower longevity expectations.
The bottom line? Finke says it’s important to talk about longevity with your clients — and that you’re in a unique position to help.
“We consistently see that those who plan for longevity feel more confident about retirement. The key drivers of that confidence? Working with an advisor, having access to guaranteed income, and building a plan that’s designed to last.”
More From The College
- Learn more about the Retirement Income Certified Professional® (RICP®) Program
- Download our Retirement Planning Checklist to work with your clients
- Give your clients the gift of knowledge with a free education program, The Retirement Course™
Retirement Planning Podcasts
Planning for Healthcare Costs in Retirement
In this special episode of the Shares podcast, recorded live at The College’s Horizons 2025 conference, Lindsey Lewis, MBA, CFP®, ChFC®, managing director and chair of the American College Center for Women in Financial Services, speaks with healthcare professional turned financial educator Carolyn McClanahan, CFP® on how financial professionals can work with clients to maximize their healthcare benefits and avoid costly mistakes. They also discuss the unique challenges facing women in situations where spouses require long-term care or other financial considerations, as well as important elements to focus on in planning with clients such as Medicare/Medicaid, deductibles, tax implications, and more.
Carolyn McClanahan, CFP® is the founder of Life Planning Partners, Inc., and a financial planner, physician, educator, and contributing writer to Forbes and CNBC. She specializes in financial planning, health and finance issues, and elder care issues. She completed her undergraduate degree at Mississippi University for Women, medical school at the University of Mississippi, and residency in Family Medicine at Virginia Commonwealth University. In 1998, she was recruited to teach at the University of Florida, Jacksonville, and transitioned to the financial services industry with the founding of Life Planning Partners in 2004.
McClanahan is a member of the National Association of Personal Financial Advisors, the Financial Planning Association, and the American Academy of Family Physicians. She volunteers as a physician with Volunteers in Medicine Jacksonville, providing health care for the working uninsured. She speaks nationally to financial planners and physicians on the interplay between health and financial issues. She serves on the CNBC Financial Advisor Council and is an Investopedia Top 100 advisor. She is quoted regularly in numerous publications, including The Wall Street Journal, The Washington Post, and The New York Times. She has appeared on CNBC, Hardball, and NPR.
Any views or opinions expressed in this podcast are the hosts’ and guests' own and do not necessarily represent those of The American College of Financial Services.
More From The College
- Secure specialized expertise in retirement income planning with the Retirement Income Certified Professional® (RICP®) Program
- Give your clients a free educational resource with The Retirement Course™
- See how you can get involved with the American College Center for Women in Financial Services
Retirement Planning Insights
Fiona Greig and the 82 Trillion Opportunity
Fiona Greig, PhD addresses attendees of Horizons 2025, The College’s flagship retirement planning event, as she examines the Boomer retirement wave, discusses one of the largest transfers of wealth ever, reviews financial identities that Americans assign themselves, and analyzes how advisors can use this information to improve client outcomes.
More From The College
Retirement Planning Press
Joining the Century Club Research
COLUMBUS, Ohio – The number of Americans living to 100 and beyond is expected to quadruple by 2054, according to the U.S. Census Bureau. Yet despite this surge in longevity, new research from Nationwide Retirement Institute and The American College of Financial Services (“The College”) reveals a troubling disconnect: while lifespans are rising well into the 90s and beyond, financial planning hasn’t kept pace. As a result, millions face a growing risk of outliving their savings.
The research—conducted as part of the Nationwide Retirement Institute’s Century Club campaign, which explores the financial implications and consumer sentiment related to rising life expectancy—highlights just how fragile the equation can be. According to The College’s research, extending a retirement by just 5 years from 30 to 35 years increases the risk of depleting savings by a striking 41%, based on historical market returns. And that risk only intensifies as lifespans continue to lengthen, particularly among healthy, higher-income retirees.
A companion consumer survey from the Nationwide Retirement Institute shows most Americans are underestimating both their chances of living to 100 and the financial demands that kind of longevity brings. In fact, only 29% of respondents said they want to live that long, citing concerns about declining health and deep financial anxieties. Roughly three in four fear they’ll run out of money before they run out of time.
Today’s volatile economic environment is raising the stakes even higher. According to the joint research, two out of five non-retired Americans (40%) now say they plan to delay retirement due to inflation. And the math is sobering when factoring in lower projected 10-year portfolio returns: Extending retirement by just five years increases the risk of running out of money by more than 300% according to The College’s analysis.
These findings send a clear message—retirement planning needs a major reset. Both consumers and advisors must shift their mindset, prioritizing longevity risk and placing a stronger emphasis on guaranteed income strategies that can weather uncertainty.
“Too many people underestimate how long they’ll live—and that blind spot can seriously undermine their financial security,” said Michael Finke, PhD, CFP®, professor of wealth management, director of the Granum Center for Financial Security at The American College of Financial Services and co-author of the study. “We consistently see that those who plan for longevity feel more confident about retirement. The key drivers of that confidence? Working with an advisor, having access to guaranteed income, and building a plan that’s designed to last.”
Knowledge is Power—and Protection
Preparing financially for a longer life starts with one key step: considering how long you might live. Yet just 48% of Americans factor lifespan into their savings and investment decisions, according to the Nationwide Retirement Institute’s survey, and only 26% of respondents correctly estimated the longevity of a 65-year-old man according to the joint research.
While the challenges of planning for longer lifespans are apparent, the Nationwide Retirement Institute’s consumer survey also reveals a powerful silver lining: if Americans knew they would live longer, many would take meaningful action to improve their physical and financial well-being:
- 58% said they would adopt a healthier lifestyle
- 67% would pay closer attention to their finances and increase their savings
- 37% said they would delay retirement
- 63% said they would take on less debt
Mindset also matters. The College’s research found that optimists are 75% more likely to save at least 10% of their income – underscoring how a positive perspective can drive more financially secure retirements. The report also refers to financial literacy as “a quiet driver of retirement readiness.”
“When people think seriously about living longer, it becomes clear that physical, mental, and financial health go hand in hand,” said Kristi Martin Rodriguez, leader of financial services marketing and the Nationwide Retirement Institute. “Just as we encourage healthy habits to support longer lives, we need to help build strong financial habits that ensure people can thrive well into their later years.”
Solutions Exist – Now It’s Time to Use Them
While 70% of Americans agree that society is not prepared to meet the needs of people with longer lifespans, the good news is that effective solutions already exist. These include long-term care (LTC) insurance and guaranteed income products, including annuities and protected retirement solutions that are available in a growing number of employer-sponsored retirement plans. The problem? These tools remain widely misunderstood or overlooked, highlighting a significant gap in consumer education.
Nationwide’s research shows that nearly one-third of consumers (32%) believe long-term care insurance would be one of the most helpful resources for preparing to live to 100. Yet, only 1 in 10 actually report owning a policy, according to The College. The story is similar for annuities: 31% of consumers say an investment that guarantees income for life would help them feel more financially secure, but knowledge and adoption of these products remain stubbornly low. Additionally, in the past few years, a new type of investment option in workplace retirement plans that can provide guaranteed income in retirement has been gaining interest and garnering discussion across the country. This type of solution is growing but there remains an opportunity for the industry to encourage more widespread adoption of these solutions.
“As the risk of longevity combined with today’s volatile market environment create what might seem like a perfect storm for retirement savers, the good news is that solutions exist to provide a measure of certainty in an uncertain environment,” Rodriguez said. “Financial professionals and others serving America’s retirement savers can play a critical role in bridging this gap, tailoring strategies to individual needs – especially for groups like women, who tend to live longer, score slightly higher in longevity literacy, yet report lower retirement confidence overall.”
These findings from Nationwide and The College reveal a powerful truth: America is on the brink of a longevity revolution, yet many Americans are financially underprepared to meet it.
The Nationwide Retirement Institute’s Total Retirement Income Planning initiative offers a variety of tools and resources for advisors to address the longevity challenge for clients.
Nationwide Retirement Institute Methodology
Edelman Data and Intelligence (DXI) conducted a national 15-minute online survey of n=1,000 U.S. consumers (age 18+), and n=200 U.S. workers ages 55-65 on behalf of Nationwide from February 18 – February 26, 2025.
As a member in good standing with The Insights Association as well as ESOMAR Edelman Data and Intelligence conducts all research in accordance with local, national and international laws as well as in line with all Market Research Standards and Guidelines.
The College Methodology
The Retirement Income Literacy Study conducted by The American College of Financial Services measures financial literacy in 12 retirement-related knowledge areas among individuals approaching or in retirement age. Researchers from The College surveyed 3,765 Americans aged 50 to 75 in 24-minute online interviews conducted in August 2023. The data was collected to match the 2020 U.S. Census for gender and race. Other figures reflect the authors’ calculations based on publicly available data. See the full report for all source citations.
About Nationwide
Nationwide, a Fortune 100 company based in Columbus, Ohio, is one of the largest and strongest diversified financial services and insurance organizations in the United States. Nationwide is rated A+ by Standard & Poor’s (5th highest of 21 ratings). An industry leader in driving customer-focused innovation, Nationwide provides a full range of insurance and financial services products including auto, business, homeowners, farm and life insurance; public and private sector retirement plans, annuities and mutual funds; excess & surplus, specialty and surety; and pet, motorcycle and boat insurance. For more information, visit www.nationwide.com.
About The American College of Financial Services
Founded in 1927, The American College of Financial Services is the nation’s largest nonprofit educational institution devoted to financial services professionals. Holding the highest level of academic accreditation, The College has educated over 200,000 professionals across the United States through certificate, designation, and graduate degree programs. Its portfolio of applied knowledge also includes just-in-time learning and consumer financial education programs. The College’s faculty represents some of the foremost thought leaders in the financial services industry. Visit TheAmericanCollege.edu and connect with us on LinkedIn, X, Instagram, Facebook, and YouTube. Discover all the ways you can expand your opportunities with us.
Contact
Mike Switzer, Nationwide
SWITZEM1@nationwide.com
614-370-0001
Jared Trexler, The American College of Financial Services
jared.trexler@theamericancollege.edu
610-526-1268
This material is not a recommendation to buy or sell a financial product or to adopt an investment strategy. Investors should discuss their specific situation with their financial professional.
This information is general in nature and is not intended to be tax, legal, accounting, or other professional advice. The information provided is based on current laws, which are subject to change at any time, and has not been endorsed by any government agency.
Nationwide and The American College of Financial Services are separate and non-affiliated companies.
Life and annuity products are issued by Nationwide Life Insurance Company or Nationwide Life and Annuity Insurance Company, Columbus, Ohio.
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