Are you prepared for the financial impact of declining health in retirement? As Americans are living longer, they are also spending more years in poor health, leading to increased medical expenses and financial challenges.
According to experts, the average person now spends about 10 years dealing with chronic ailments like diabetes, cancer, arthritis, cardiovascular disease, dementia, cataracts, or osteoporosis. This is double the duration compared to the 1960s. As a result, there is a widening gap between one’s life span and health span.
The concept of a health span is becoming increasingly important for household finances. Medical costs escalate once chronic ailments are present, with about 90% of the nation’s annual $4.5 trillion healthcare costs going towards people with chronic diseases and mental health conditions.
Early retirement due to poor health can also lead to financial challenges, including higher out-of-pocket medical expenses. For example, the average 65-year-old retiring this year will spend about $165,000 in out-of-pocket health and medical expenses in retirement. This can result in claiming Social Security earlier than expected, leading to a lower monthly benefit.
It’s important to invest in your health as early as possible. Consider purchases of healthy food, gym memberships, or exercise classes as investments in yourself. Prioritize spending on your health and cut back on expenses that do not increase your health span. Remember, your health directly impacts your wealth, especially as you age.
Healthy lifestyle choices can have a significant impact on your long-term financial well-being. By investing in your health now, you can potentially avoid significant medical expenses in the future. Remember, it’s never too late to start making positive changes for a healthier and wealthier future.