First A History Lesson. When a sixth century Saxon graveyard in Southern England was excavated by archaeologists they found 84 bodies, none of whom had died from violence. They estimated that the oldest body in the graveyard was 45 years old but average age at death was just 28.
In 1641, English philosopher Thomas Hobbes wrote – “Life in the state of nature is solitary, poor, nasty, brutish and short”. The average lifespan of an Englishman then was 36. When the first English census was completed in 1871, lifespan had increased to 44. The latest estimate of lifespan in England is now 84. For the last 140 years, average lifespan in the UK therefore increased by more than 33 months every decade.

A Longer Life Is Great But At What Cost?
Rapid advances in medical technology have prompted predictions that by 2040, lifespans will increase by one year for every two years that pass. Obviously this is good news if the extra years are spent in good health with a good quality of life. The downside of course is that older people work less and are likely to need much higher spending on healthcare.
Demographic predictions show a rapid increase in people aged 70 over all over the world. This will be accompanied by a fall in the working age population, meaning fewer people working to pay for the care of a rapidly increasing retired and frail elderly population. After your 70th birthday, you will use 90% of the medical resources you will use in your life.
This will be a major problem for governments who will be receiving less income in tax receipts but will be spending much more to look after their elderly population. This will lead to much higher spending on healthcare. The US Congressional Budget Office estimated that in 2015 spending on every aspect of healthcare was $3 trillion. By 2025, just nine years from now, they estimated this will be $5.4 trillion, an increase of 80% in just ten years.
But Wait, Long Life Means Opportunity
We can see that our retirements are going to be longer but that we must be increasingly self-sufficient. We are the ones who must take on the responsibility for our own financial future, including our increasingly expensive healthcare needs. We must realise that we are going to have to save and invest more money over a longer period of time.
People living longer but requiring more healthcare means that investing in healthcare, health science and biotechnology is very likely to be a winning strategy. Instead of worrying about paying for our healthcare needs we could instead invest in the healthcare sector to provide the increased resources needed.
In the last three years hypodermic needle maker Becton Dickinson rose 54% while Walgreens Boots did even better rising 121%, roughly 40% per year. Bristol Myers Squibb rose over 136% over the last five years.

Healthcare Investment: A Clear Winner
I have taken advantage of this trend by investing in healthcare for myself and my clients. We invested in the Blackrock Global Healthscience Fund which returned 85% over the last five years. Also in June 2013 we bought shares of Proshares BIB, a double geared biotechnology fund at $23.50. I sold them in August 2015 for $89, a return of 278% in just 26 months. (Please note that these companies and funds are mentioned for information only, they are not recommendations).
Expect to enjoy a longer and healthier retirement. Save more, but do not rely on a state pension. They will be meagre, delayed and increasingly heavily taxed. Please don’t wager your retirement on a politician’s promises!
Healthcare investment and healthcare services could be the winner to help to fund your extra golden years.