Health is Wealth: Want an Extra $900k? Take a Walk

After years of parents telling their children that “a little hard work won’t kill you,” it turns out that too much of it actually can kill you. Virgil was probably the first to connect health and wealth, and I believe it: “The greatest wealth is health.”

A recent study published by the World Health Organization (WHO) and International Labour Organization (ILO) estimates that 745,000 people died in 2016 from stroke and heart disease due to long hours. The research, which attempted to control for socioeconomic status and gender, found that working 55 hours or more a week was associated with a 35% higher risk of stroke and a 17% higher risk of dying from heart disease. This was compared with a working week of 35 to 40 hours.

How does working long hours kill you? Well for one, it contributes to chronic stress, which has been known to increase inflammation and disease in the body. The other factor, is that working long hours reduces the time and motivation to eat healthy, exercise and get enough sleep. It can also lead to unhealthy coping mechanisms like drinking, eating junk food, smoking, or overspending.

These findings are especially disturbing since they come at a time when working long hours has become the norm.

HEALTH IS WEALTH: THE MOST COMMON “WHY” FOR FI

If you’ve read other FIRE blogs, you know health is a common reason for pursuing financial independence and early retirement. Many people drawn to the FIRE lifestyle have either had a health scare, lost a loved one too soon, or work in a demanding career that has caused physical or mental health issues.

I constantly worked long hours during my accounting career, with several months each year of 60-85 hours a week. It seemed so normal at the time, but I ultimately decided that the price was too high for the paycheck. Over the years, my mental and physical health deteriorated from all the stress and long hours. I absolutely believe that lifestyle would have led to an early grave. I’m hoping it’s not too late to undo the damage. Health is my main why for FI.

TLDR: Your health isn’t worth a bigger paycheck

Our society is hyper focused on achieving “success” at all costs. We value powerful titles, high salaries, big houses, and fancy things. I came to value these things as well. Long hours and being constantly busy was brag-worthy. But that kind of success and wealth often comes at the detriment of our health.

It’s time to stop trading health for a bigger paycheck.

Maybe retiring in the near-term isn’t an option for you. That’s okay. If you work towards financial independence, you’ll achieve security and freedom that will allow you to prioritize health and well-being. Even if that means switching jobs, taking a sabbatical, or going part-time for a smaller paycheck. In our case, we decided to switch to a single paycheck, which has allowed both my spouse and I to have more time and less stress.  

Money can buy a lot of things, but it can’t buy you a healthier or longer life. What good is a big pile of money if you aren’t around to enjoy it? 

HOW MUCH CAN YOU SAVE BY INVESTING IN YOUR HEALTH?

Although I was driven to improve my health for the reasons above, the financial nerd in me wondered: “How much could I increase my wealth by investing in my health?”

With healthcare costs being the biggest cost in retirement, it only makes sense to try and reduce those costs.

While we can’t control everything, we can tip the odds in our favor by making a few simple changes today. Newer research is showing that several chronic diseases plaguing first world countries are mostly avoidable through lifestyle interventions. These diseases, which are some of the most expensive to manage, include diabetes, heart disease, hypertension (which leads to stroke), and osteoporosis.

The Research: How much does disease cost and how much can exercise save you?

With my curiosity peaked, I set forth in my research to determine if health really does equal wealth.

It turns out that it’s really difficult to find an answer as to how much investing in your health and avoiding chronic disease can save over time. I guess that’s not too surprising though, since every person’s medical history and circumstances are different. It’s also nearly impossible to isolate the cost or benefit of a particular disease or healthy behavior from other factors.

Nonetheless, I did learn some interesting information from studies performed over the last 10 years. This biggest takeaway? Chronic diseases are EXPENSIVE! Here’s just a sample of the research I found:

Cardiovascular Disease (CVD) – According to a 2010 study by The American Journal of Managed Care, the mean direct medical care costs for patients diagnosed with CVD were $18,953 per year. This is an average over time, since events like a heart attack are very expensive but don’t happen every year. If we update these findings for inflation since 2010, the annual cost would be $25,563.

Diabetes – According to the American Diabetes Association, people diagnosed with diabetes have medical expenditures approximately 2.3 times higher than those that do not, with an average annual medical expense directly attributed to diabetes of $9,601 (in 2017 dollars). In today’s dollars, this would be $10,582.  

There’s good news though…

By investing in our health today, we can drastically reduce the risk of chronic disease and future healthcare costs!

The most generalized and pervasive study I found in my research was one published in the Journal of the American Heart Association, which looked at the effect of physical activity on medical costs and mortality. According to the study, just walking 30 minutes a day could save the average American $2,500 in annual medical expenses (or $3,157 in today’s dollars), in addition to significantly reducing cardiovascular disease risk and mortality risks from all causes!

The Analysis – how much wealth could you accumulate by taking a daily walk?

Let’s look at how much wealthier we could be in the future if we began investing in our health today!

For the purposes of our analysis, let’s keep it simple. We’ll look at the expected healthcare savings from taking a daily 30-minute walk (or an exercise program meeting the recommended 150 minutes of moderate activity per week). If you recall from above, the average annual reduction in healthcare costs estimated in today’s dollars is $3,157 per year. These savings could be higher or lower based on your own circumstances. However, it’s a good baseline for our analysis.

Another assumption we’ll make to simplify the calculation is to ignore the inevitable inflation of medical costs. As medical costs continue to rise, the difference in costs between someone who is healthy vs. not healthy will likely also continue to grow.

Finally, we’ll perform this analysis over a 45-year period. A reasonably healthy person in their 30’s or 40’s, has a good chance of living for another 45+ years. You can use the linked calculator to adjust the timeline if you’re older or younger.

If the $3,157 savings on healthcare costs each year are invested at a compound annual growth rate of 7%, you would be over $900,000 wealthier in 45 years!

One caveat:

The results above might technically be inflated. Why? Because a healthy person, with no chronic health conditions, will likely live longer than someone who is not. Healthcare costs drop to $0 after you die. So even though the average annual costs will be less for the healthy person, the total costs over their lifetime could actually be more.

Dying young is not the way I want to save a few bucks. For that reason, we kept the lifespan constant in the analysis above. Though we were also pretty conservative with the lifespan and estimated annual savings selected, which I think offsets some of this.

4 EASY WAYS TO IMPROVE YOUR HEALTH AND WEALTH:

1. Exercise regularly (walking counts!)

Not only can regular physical activity help to prevent and manage chronic conditions like diabetes and heart disease, but studies have also shown that exercise improves mental health issues as well as (or better than) medications. Preventing or managing these diseases saves both you and the health care system a significant amount of money over time.

You don’t have to join a fancy gym to begin a workout routine. Walking, running, hiking, yoga, weightlifting and several other sports can be done with little to no equipment or cost. Plus, doing these activities outside has additional benefits for our health.

Need more reasons to start working out?

A study of 140,000 older adults by the American Cancer Society found that people who walked six hours per week had a lower risk of dying from cardiovascular disease, respiratory disease, and cancer than those who did not. Even walking as few as two hours per week improved longevity.

A study of 334,000 men and women published by the American Journal of Clinical Exercise found that even a brisk 20-minute walk each day could be enough to cut your risk of early death by 16% – 30% (regardless of your weight).

A study published by The New England Journal of Medicine, found that people who met physical activity guidelines by walking had a 30% lower risk of cardiovascular disease, compared with those who did not walk regularly.

Researchers at the University of Boulder Colorado and University of Tennessee found that walking regularly lowered blood pressure and could reduce the risk of stroke by up to 40%.

Finally, working out regularly can help to create a routine and a sense of accomplishment. This is especially important for improving mental health and finding purpose in early retirement.

The takeaway: Even if the scale isn’t budging, you can be confident your daily workout is increasing your odds of enjoying a longer healthier retirement.  

2. Eat healthier (meaning, less sugar and more whole foods)

The human body is an incredible and complicated system. What we put into our bodies has been proven to significantly impact our health. And by the way, you can’t cure a bad diet with exercise and supplements.

Unfortunately, politics and special interest groups make it difficult for the general population to understand what a healthy diet is. Outside of personal finance, health is my other nerdy passion, and I’ve read dozens of books on the topic. While there are hundreds of diets and viewpoints regarding food, most experts now agree on a few recommendations:

– Eat more whole foods, and fewer processed foods

– Load up on more greens, vegetables, and low-sugar fruit

– Avoid or reduce consumption of sugar and trans fats

– Eat less or avoid “feedlot” /industrial meat (instead, if you choose to eat meat, buy pasture-raised, grass-fed, or wild)

I personally exclude even more items from my diet, but I know some food philosophies are still controversial, so won’t go deeper here. However, it’s hard to argue with “eat more whole foods.”

3. Drive less, walk more.

Kind of a no brainer, right? While not everyone has the luxury of ditching a car, you can still save money and improve health by driving less and walking more.

For example, we can walk to a grocery store, pharmacy, and a few restaurants from our house, and do so regularly. You can also park once in a shopping plaza when running errands, rather than moving your car after each store. These simple acts will increase your steps during the day, save money on gas, and reduce your carbon footprint.

If you are able to get by with just one vehicle, you could save even more by the way of vehicle, insurance and maintenance costs.

4. Do more “chores” yourself

If you have the time and motivation, consider the tasks that you hire other people to do. Could you take some of those on yourself? Common maintenance chores like yardwork, cleaning, and gardening are actually great ways to get more functional exercise and movement into your day. Plus, doing the work yourself eliminates that cost from your budget and you’ll get the job done how and when you like.

Proof that health and wealth go hand in hand.

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