The Cost of Not Listening to Your Doctor

Most don’t think about staying healthy as an easy way to make money, but health offers a significant return-on-investment (ROI). Staying healthy allows us to work longer, save more money, and hopefully enjoy spending it throughout retirement. Most don’t equate their doctor’s orders as an easy way to make money, but this too offers a significant return-on-investment (ROI) because the more you listen the less you have to go.

Health as an Investment

In the U.S. today, 69% of adults are either overweight or obese. This not only affects physical and mental health but also contributes to conditions such as high blood pressure and diabetes.  This means more trips to the doctor, more health complications and therefore, more out of pocket costs. Despite this, many still undervalue the connection between poor health and its impact on finances and life expectancy.

To this point, it has been difficult to quantify how better health directly leads to more wealth. But, by drawing on 530 million healthcare cases and actuarial data, HealthyCapital shows how simple changes (like reducing salt intake) can have real long-term benefits like saving individuals thousands of dollars each year in medical expenses and increasing time with the grandchildren in retirement.

The Benefits of Improved Health

It may not be a surprise that healthy people live longer and pay less each year for healthcare, but what may be a shock is by how much.

Based on actuarial data, Georgia, a healthy 45-year old woman who exercises regularly, eats well and maintains a proper weight has an average life expectancy of 90 years. Meanwhile, Jane, a 45-year old woman with diabetes who is slightly overweight and often forgets to take her medications, has an average life expectancy of just 75. Georgia will only spend on average $3,304 this year in healthcare costs (including her portion of employer premiums) while Jane will spend $5,356.

It’s important to recognize that diabetes, like many other common chronic conditions, can be managed. If Jane makes small, simple changes such as taking her medication as prescribed, following a diabetic diet (cut down on the candy), and being more active (taking a walk after dinner more often than not), she has an opportunity to increase her life expectancy by almost seven years and decrease her annual out of pocket healthcare costs by $4,000.

Incentivizing Better Behavior

Most working Americans recognize that it’s important to adopt healthier lifestyles. The difficulty, however, comes when making changes without a tangible and worthwhile reward.

If saving several thousand dollars annually or living seven extra years aren’t enough, here’s another perspective; if Jane invests the annual savings from her reduced medical expenses – at a 6% average annual return – she can accumulate an additional $133,000 in savings by age 65. Now there’s some motivation!