Financial capital is not the only important capital. This article examines another area of your life that needs attention and investment to thrive – your health. I review the current cost of healthcare and global life expectancies. And I analyze potential root causes for the United States’ declining life expectancy. I then outline a few actionable steps we can take to become outliers. By gaining financial margin in our lives, we gain choice which we use can use to improve our health. And just like investing in capital markets, health improvement is gained incrementally over time.
The Cost of our Healthcare
Health – without it, life is painful. Americans have access to the most advanced healthcare system in the world. And we spend more than any other country on healthcare by far:
Healthcare Spending Results
The chart below shows the top 10 life expectancy countries and the US over the last 30 years. The trend is not good. It appears our life expectancy has peaked and is now declining.
Combining these two data sets – Per Capita Healthcare Spending (top 25) and Life Expectancy:
The United States does not realize a good return on investment. We spend twice as much as the next country (Switzerland) and have the lowest life expectancy of the 25 top spenders.
What should we do with this information? Become outliers. Invest in your health so that your personal mark resembles the blue marks and not the red one. Not all illness is in our control, but our lifestyle has a major impact on health. What good is achieving massive savings rates to enjoy a fantastic retirement if your is life shortened or plagues by illness?
Root Cause Analysis
Why are we spending more on healthcare, but not gaining increased life expectancy? I reviewed data for a few possible contributing factors.
Hours Worked
Work hours per week. Shown below are average annual hours per worker sorted from least to most. United States employees work more hours than 25 other countries – most of which have longer life expectancies:
We work above average hours (total hours worked / number of workers). In the US, we work 29% more hours on average than the country with fewest work hours – Denmark.
Sedentary Lifestyle
The United States is not found in the top 10 of average steps per day – it’s 14th:
Eat your Veggies?
I know vegetables are important, but…
The US ranks 42nd in vegetable consumption at 113 kg. per person/yr. Most of the top vegetable consuming countries do not have higher life expectancies, but there could be mitigating factors. These are developing countries that aren’t on the top healthcare spenders list either. I compared these 15 countries to the United States and found that the US ranks 5th in life expectancy among this group. Also, except for the United States and Lebanon, the other country’s life expectancies are increasing. If the trend continues, several more may surpass US life expectancy over the next two decades.
What is the Cost?
To better analyze this situation, you would review outcomes other than life expectancy. It is a good place to start though. For inputs, I looked at average hours worked, steps taken per day and veggie consumption. And it appears that life expectancy has a negative correlation to hours worked. The United States works more than 25 other countries. And we do achieve above-average global GDP per capita for those extra hours (ranked 13th).
But, at what cost? Our life expectancy appears to be collateral damage. We are a country that spends twice as much per capita on healthcare than the next closest country. We are more sedentary and work more hours than countries with longer life expectancies. And our life expectancy is declining.
What can we do about this?
Steps to take
- Dollar-cost average your health – like investing in capital markets, invest in your health consistently over time. Here’s a few ideas I’ve implemented:
- Exercise –
- Create a basic garage/home gym. You don’t need much to get started: barbell, plates, squat stand.
- Listen to your body. I used to be a runner, but found I enjoy walking more as I’m getting older. In the morning I grab a cup of coffee, pop-in some earbuds and head out on a short walk. I allow my thoughts to wander, before my workday begins.
- Nutrition –
- Batch prepare salad ingredients at the start of the week. I knew I wasn’t consuming enough veggies and realized the reason was preparation time. Now I chop veggies into a container and buy a large tub of spinach weekly. I blend these two each day along with a simple dressing of oil, vinegar and spices. Often, I’ll top the salad with leftover meat from the night before. Inexpensive, healthy and convenient. And it’s one less decision to make each day.
- Sleep –
- read Sleep Smarter and made incremental changes
Financial Margin and Choice
Key takeaway – build financial margin in your life. Allows you to make career decisions that are best for you and your family. What if you could afford to earn 10% less per year in exchange for working a less demanding, less stressful job. Would you do it? Could you do it? Unfortunately, we often don’t have the margin for this luxury of choice.
For me, the pursuit of financial independence is about gaining choice. Choice is gained as margin increases in your life. The systems you put in place: saving, investing or health-related create this margin. As you set up personal finance systems, don’t forget to do the same for your health. There are no guarantees in the markets or your health, but control what you can control. And hopefully you will be blessed with health to enjoy the financial margin you’ve created.