It Pays to Get Fit: The Economic Benefits of Health
Adopting a healthy lifestyle can help you save money in more ways than one.
In the U.S., healthcare spending has been rocketing upward since the late 1990s, and at last report from the Centers for Medicare and Medicaid Services, it now tops $10,739 per person or a staggering $3.5 trillion per year. Instead of investing all that money in doctors, pills, and the insurance policies that pay for them, consider the economic benefits of maintaining good health.
What is good health?
The World Health Organization (WHO) says that health is “a resource for everyday life, not the objective of living. Health is a positive concept emphasizing social and personal resources, as well as physical capacities.” A healthy person’s body operates at optimal capacity due to an absence of disease and the presence of adequate exercise and nutrition. People in good health typically live longer and more satisfying lives than their less-healthy neighbors.
To stay in good health, most researchers and healthcare providers agree, you need to maintain a few basic habits:
- Don’t smoke. According to the Center for Disease Control, smoking contributes to one in five deaths in the U.S. That’s more than HIV, motor vehicle accidents, drugs, alcohol, and firearms combined. Smoking increases the risk of stroke, coronary disease, lung cancer, and chronic obstructive pulmonary disease. The best way to improve your health, save money, and avoid an early grave? Quit smoking.
- Eat a diet rich in whole grains, fruits, and vegetables. It’s one of the best ways to prevent obesity, which contributes to coronary diseases, type 2 diabetes, and certain cancers. Plus, obese patients spend $1,429 at the doctor than those with a healthy weight.
- Exercise. Just 150 minutes of moderate aerobic activity or 75 minutes of vigorous activity per week can lower your risk of numerous health conditions. These risks include dementia, heart disease, arthritis, and injuries. Exercise can also improve mood, lower stress, and increase overall wellbeing. A gym membership or a sturdy pair of running shoes is a small investment, and the Journal of the American Heart Association estimates that exercise could save Americans $500 and $2,500 a year.
Insurance rewards a healthy lifestyle
Life insurance is a gamble. The insurance company is laying odds that you will live a long time. That’s why insurance providers want their insured to stay as healthy as possible: good health prolongs life expectancy. You may be eligible for a lower life insurance premium by having a lower Body Mass Index (BMI), for instance, or by being a non-smoker. Some life insurance companies will also award you healthy lifestyle credits based on a matrix of your current health, your health literacy, and your active lifestyle.
Nearly all life insurance agencies determine your policy’s cost by assigning you to a class such as preferred, standard, or standard tobacco. People with the fewest health risks go into the preferred class where they pay the lowest premiums. Less-healthy individuals pay higher costs as members of the standard class while smokers can pay four times as much for life insurance as a healthy preferred customer. Not only is life insurance cheaper for healthy individuals, but so are disability and health insurance.
Health insurance carriers have instituted more complex programs that reward people for healthy behaviors. Incentives for health behaviors include going for annual checkups, losing weight, or getting a flu shots. These insurers may provide gift cards to participating retailers for people who engage in activities designed to prolong their lifespan. It’s a good idea to check with your health insurance carrier about fitness reimbursement benefits, free health classes, and other incentives for staying healthy.
Why does being healthy reduce your expenses?
You can lower overall healthcare costs by taking steps to prevent diseases and improve your health. Staying health means you take fewer sick days, buy less medication, pay for fewer doctor’s visits, and often reduce your expenditure at the grocery store and at restaurants. Here are a few more ways being healthy helps you stay within the household budget:
- You stay more productive. A 2012 study at Brigham Young University determined that “employees with unhealthy diets were 66 percent more likely to report having a loss in productivity.” In other words, when employers are deciding who has to go in a mass layoff or who gets the next promotion, healthy workers are more likely to come out on top.
- You remain active longer. Healthy people can continue to work full-time or part-time past their retirement age. You can be comfortably socking away money while your less-healthy peers are spending it.
- You spend less money on junk food and sedentary hobbies. Treats, snacks, fast food, desserts, and sugary coffee drinks don’t come cheap. Let’s say you cut back two fast food meals per week at $11.50 each. By just doing that, you can put $1,200 in the bank, an investment, or a retirement account this year. Multiply that number across your working lifetime, and you could be looking at real money.
- You cut out the cost of cigarettes and booze. A pack-a-day smoker spends $2,011 per year on cigarettes alone. By eliminating smoking and reducing alcohol to 1-2 drinks per day, you can improve your health and save money.
- You may save on gas and car-related expenses. Getting healthy can mean walking to work on nice days, biking to a friend’s house, or jogging to do a quick errand. By doing so, you may inadvertently cut back on gas and other transportation expenses.
Steps the government is taking to make a healthy life a better life
Not only do insurers want you to stay healthy, but the government does, too. The PHIT Act, which would make gym memberships and fitness classes tax deductible, serves as just one example of ways that public policy makers are encouraging people to make healthy choices. State governments are looking at how to make school lunches both healthier and tastier. Local municipalities are changing zoning laws to make sure low-income communities have access to nutrient-rich, low-calorie foods at affordable prices.
Staying healthy benefits more than just you. It also improves your family’s life and raises the wellbeing of your entire community. Plus, by not smoking, eating right, and exercising you can save money on insurance, at the grocery store, and even the fuel pump.
Looking for other ways to get financially fit in 2019? Check out our financial fitness New Year’s Resolutions for 2019.