The most overlooked investment ever

Very few things in life are a sure thing.  We invest to have more money for the future, but positive returns are not guaranteed.  We study as diligently as we can for that final exam, but we’re not assured to get an A.  We can set up a perfect business plan for the perfect product in the perfect location, but business is not always going to be booming.  We do all the things we do to get ahead, but not of the results are guaranteed.  All we can do is put ourselves in the best position possible to succeed.  And hopefully we will.

Looking at the title of this post, most people would guess that investing in yourself is probably the most overlooked investment.  We would think of things like learning a new language, taking an online course or just getting out of your comfort zone as great investments in yourself.  But an even more overlooked investment, and this should definitely be thought of as in an investment, is your health.  Without good health, literally nothing is possible.  Not being able to get out of bed or always feeling tired or sick can completely destroy any plans of self improvement you have made for yourself.  Your financial health is also tied to your physical health and longevity.  There are direct and indirect costs associated with your health.

Direct costs:  The direct costs are the obvious ones like health insurance premiums and doctor visits.  There is also the cost of medications and any surgeries needed.  These costs can really add up for chronic conditions as well.  In a study released by the American Diabetes Association, people diagnosed with diabetes have average medical expenses of $13,700.  That’s a lot of money to be spending every year.  Add to that the fact that many children are no being diagnosed with diabetes, and people will have to be paying a lot of money for a long time.  The opportunity cost of having to spend all that money on your health, however, can trump the actual cost.  All this money used to spend on diabetes, which for the most part is a preventable condition, could be used to increase savings or investments.  Direct health related costs can definitely be a huge burden on a family’s finances.

Indirect costs:  The indirect costs related to healthcare can sometimes be more alarming than the direct costs.  Indirect costs can include things like time lost from work, decreased productivity at work and loss of production due to dying early.  While these values are almost impossible to measure on an individual basis, the same study conducted by the ADA was able to estimate the effect on the US economy.  People missing work cost the country $5 billion.  Reduced productivity at work cost the country $20.8 billion.  The amount of money lost due to disability was $21.6 billion.  These are staggering numbers to look at based on the effect of only one disease.  The most productive people in the world jump out of bed and attack the day with all they can.  If you aren’t able to jump out of bed easily anymore or are tired and in pain most of the day, it is obvious that your productivity is going to drop.

Looking together at the direct and indirect costs of poor health, it becomes clear that having health issues can be a real financial strain.  As I said in the beginning of this post, nothing is guaranteed.  And that includes your health.  Athletes at the top of their game and in the best shape of their life can suddenly be diagnosed with diabetes.  A drive to the supermarket which we have made hundreds of times before can end up in a deadly accident.  A leisurely bike ride to help out health and stress levels can result in tragedy.  These types of things can happen but we shouldn’t worry about them because we can’t control them.  What we should worry about are doing the little things day after day that will allow us to be as healthy as possible, as long as possible.

Treating our health like an investment account will definitely pay great dividends down the road.  Having good health will allow us to avoid the direct and indirect costs of poor health, which can easily derail any financial plan.  More importantly, being healthy will allow you to be at your most productive and enjoy your life to the fullest.