The Real Secret of Retirement Happiness

What You Need to Know

Researchers have drawn a clear connection between greater wealth and greater longevity in retirement.
However, a growing body of academic work suggests wealth is only one part of the equation, as factors such as social connection also seem to matter a great deal.
Ultimately, a plan for retirement that does not account for the “where” and “why” is not a complete strategy.

The connection between wealthy communities and healthy aging is demonstrated in an established and growing body of academic work, but researchers have found much greater variability among middle- and lower-income areas, where some communities far exceed their socioeconomic peers in health outcomes and life expectancy.

As explored in a new report and podcast published by the Stanford Center on Longevity, aging experts often say that “place matters” for a healthy and fulfilling retirement, but they don’t always agree on exactly why.

Some point to the fundamental importance of social connection and community, while others cite more concrete factors, such as exposure to better air quality and the ready availability of green safe spaces for exercise.

What is clear, according to the Stanford Center on Longevity, is that wealth is not the only factor that matters when it comes to a long, healthy and fulfilling retirement, and as such, financial advisors and their clients must account for the “where” and “why” as they build retirement plans.

Doing so can not only help ensure that the dollars and cents are in order — it can also have a fundamental effect on the quality and duration of the retirement experience.

Eye-Popping Discrepancies

As explored by the Stanford experts, longevity discrepancies within a given U.S. city or region can be surprisingly dramatic. For example, in New York, average life expectancy can differ by as much as 30 years between neighborhoods situated just a few miles or metro stops apart.

Broadly speaking, those neighborhoods with higher average incomes and wealth levels exhibit longer average life spans, reflecting the simple fact that individuals with higher incomes exhibit significantly lower mortality risk.

As one study published in 2021 by the JAMA Health Forum shows, Americans who had accumulated a higher net worth by midlife had significantly lower mortality risk over the subsequent 24 years.

In sibling and twin comparison models that controlled for shared early life experiences and genetic influence, the association between net worth and longevity was similar in magnitude. Greater net worth at midlife is strongly associated with longevity among adults in the study, and this association is unlikely to be merely an artifact of early experiences or heritable traits.

While compelling, this dynamic does not account for the findings of researchers who show significant differences in longevity between neighborhoods, cities and regions that exhibit very similar average economic standing. With equal economic standing, the researchers explain, these neighborhoods must feature other differences that affect longevity.

According to the Stanford Center on Longevity, emerging academic work shows life span discrepancies are not only tied to economics, and as such, there is a need to study how more nuanced lifestyle factors affect the longevity of older Americans.

Simply Superior Locations

The Stanford Center on Longevity experts refer to middle- and lower-income areas that demonstrate higher life expectancy as “naturally occurring retirement communities,” or “NORCs” for short.

As defined in the new analysis, a naturally occurring retirement community is a community or neighborhood with a growing population of older adults in which the dwellings were not purposefully intended for older adults when they were originally designed and/or built.

A NORC can develop in a few ways. It can occur as residents move into a building, group of buildings or residential area and age in place over time. Additionally, younger residents might move out or older residents might move in. The age demographics evolve naturally, but the key metric is that at least 40% of households have a resident over the age of 60.