The Intersection of Wealth and Health

Intersection of London and Paris

By the time you’re reading this, we should have already arrived in London.  When we first found out we’d be moving, there was one person who could not contain their excitement.  Based on her reactions here and here, I think she may have even been more excited than we were!  It’s only fitting then that on the day we arrive in the UK, she’d be the first personal finance blogger to make a guest appearance on this blog.

In case you haven’t figured it out yet, today’s post is brought to you by Maggie Banks at Northern Expenditure.  We’re so glad Maggie was gracious enough to write a post for us and we hope you enjoy! 

Mr. and Mrs. DTG are great about focusing on healthy living as part of their overall financial journey. This message on their amazing blog has always resonated with me (I’m an early fan). Health is important. What if you become a millionaire overnight but are too sick to enjoy it? That wouldn’t be worth the price! But health can also have direct impact on your finances in many ways and that’s what I wanted to examine more closely today.

Addictions

Let’s examine your poor health choices and how much they actually cost you. We’ll start with the most obvious one: smoking. We’ll go with the U.S. average cost of a pack of cigarettes: $5.50. Say that pack of cigarettes has 20 in it, so each cigarette costs about 28 cents. The average amount of cigarettes smoked per day in the U.S. is 12 cigarettes which would cost $3.36/day. This adds up to $1,226/year. And that’s just the raw cost of the cigarettes! You know they’re bad for you! Add to that $1,226 the $2,000+ that you will require in extra healthcare costs just because you’re a “smoker.” These costs can add up and impact your overall wealth. In 2005, heavy smokers were found to have, on average, net worths that were $8,300 lower than non-smokers.

Maybe your addiction is alcohol. Alcohol has a much larger sliding scale of addiction. We’re going to assume you’re not an alcoholic, but maybe you NEED wine with dinner. After dinner? Both? Beer with lunch?

How about coffee? How much do you need to pick up a coffee on the way to work?

Fast food? You’re not off the hook! Instead of making a sandwich, you are addicted to driving through Wendy’s with a few choices from the dollar menu (which, for the record, doesn’t exist in Alaska). Add sales tax to that (which also doesn’t exist up here in Anchorage) and you’re looking at the same $3.36/day we were looking at with cigarettes! If fast food becomes an addiction, you’re looking to join the ranks of the obese people of the world. Incremental costs associated with obesity (and its many comorbidities) is an extra $5500!

Examine your addictions. If “It’s bad for your health” isn’t enough to get you to re-examine, maybe: “You’re going to ____ yourself broke” might work.

Inactivity

Just like everyone knows that addictions are bad for your health, everyone knows we should be exercising. I work in behavioral economics research and often focus on the healthcare side of things. Let me tell you that, after the thousands of studies I have read, the one thing you can do to improve your health is walk. Walking improves nearly every disease or condition. It leads to earlier mobility after surgery. There’s even research showing that walking outside has a huge impact on so many things because you have to navigate rough sidewalks, tree roots, you get fresh air, the sunshine, etc. A few doctors have started prescribing park time to kids!

On the flip side, there are significant costs associated with inactivity. A study out of Canada estimated that $2.1 billion of annual medical expenses in the country were caused by inactivity. A 10% increase of people walking could save the country $150 million/year! Individually, in 1987 dollars, inactivity-related healthcare costs were $330/year. In 1987! Think what they are now with the costs of healthcare!

People are often under the impression that unless you’re doing some insane exercise routine, you won’t see the health benefits. NOT TRUE! Brisk walking 30-60 minutes a day is the sweet spot of ALL the benefits! That’s it. Just walk.

Healthcare Costs

We’ve already discussed the taboo topics of smoking, obesity, and inactivity. They can easily land you in the hospital, but so can many other things. The costs associated with any major health event are astronomical. A friend of mine just told me that even with her high-deductible insurance and natural (no drugs), complication-less childbirth, it took her 19 months to pay off the bill! One in five people struggle to pay for their healthcare. In fact, healthcare has been cited as the number one reason for personal bankruptcy! If you can keep yourself healthy, you can avoid a lot of those charges entirely.

Healthcare costs are a bit of a Catch-22. Say that last super value meal put you into the hospital with a heart attack. Then you get the bill for the heart attack. It turns out that bill can cause poor health as well! It’s an endless cycle!

MAKE A CHANGE!

Any simple changes that can improve your overall health will save you money in the long run and allow you to enjoy your future wealth! Here are some ideas:

  • Join the Meatless Monday movement. Meat is one of the most expensive line-items on any food budget and meat in excess is not particularly good for your health. Cutting out meat at least one meal per week will help your health and your wallet.
  • Go for a walk. Walking, as we’ve mentioned, has a huge impact on your health. There are no gym fees or special equipment required.
  • Prepare healthy snacks. When Mr. T and I cut up all of our veggies for the week on Sunday night, we eat healthy all week long because we’ve batched the work. When you’re hungry, you’re certainly not going to want to cut up a pepper or celery. But if you plan ahead, you’re more likely to stick to healthy choices.
  • Examine Your Addictions. (Mine is Trader Joe’s Brownies. I love them so much I import them.) If you can cut back or cut completely anything that has become a habit, your health and wealth will thank you.
  • Drink Water. While needing 8 glasses of water a day is a myth, drinking water is still important. If you drink water before a meal, you’ll eat less saving you money on food (and possible obesity costs!). If you drink water instead of soda, the results will be the same (with an added benefit of decreased dental costs!)

7 thoughts on “The Intersection of Wealth and Health

  1. Tracy says:

    Great article Maggie! I’m glad I never started smoking and rarely drink alcohol. I lost about 50 lbs last year and have been keeping it off with walking and tennis as well as eating healthy. I still have some foods that are a weakness for me so I have them but not very often. Overall, I think I eat about 90% better than I used to and feel great. Health is my real concern but I love that I’m also saving money. Big side bonus! And, DTG is living my dream too! I hope to get to visit for 6 mos after I retire! Hope you guys love living in England and I’m super excited to read your upcoming posts about it!

    Liked by 1 person

    • Ditching the Grind says:

      Great job on the weight loss! Beer is my one weakness. I could probably save a couple hundred bucks a year right there. Oh well. But, as Maggie mentioned, health and finances really do impact one another.

      So far England has been great. We’re almost completely settled and soon we’ll really begin exploring!

      Like

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