We all know that being in poor health as the result of an accident or chronic illness can have a negative effect on our finances. Long hospital stays and the need for regular medical treatment can exact a serious economic toll, but the inverse is also true. Indeed, the different ways in which we spend our money can have a significant impact on our health.
Not saving for retirement
A 2014 survey conducted by the Federal Reserve Board found that nearly half of the U.S. adult population have done no post-retirement financial planning. While some may believe that the Social Security system will take care of them after they stop working, that’s not necessarily the case. The reality is that Social Security only covers 40 percent of a worker’s pre-retirement income, but 70 percent is needed for an individual to live comfortably. To better prepare for your golden years, you should try to save 15 percent of your annual income.
Putting your savings in the stock market
Although maintaining a diverse investment portfolio is a good idea, putting too much of your savings in the stock market can adversely affect your financial health. The volatility of the market could lead you to receiving a record return on your investment in a boom period, but if you wait too long, you can lose everything in a market crash. Even worse, trying to keep up with the ever-shifting marketplace can lead to the development of an anxiety disorder that is so severe, hospitalization could be necessary.
Excessive fast food consumption
Because of its widespread availability and its perceived cheapness, fast food has become a staple in the diets of millions of cost-conscious Americans. In fact, the Centers for Disease Control and Prevention reports that 11.3 percent of the average American’s caloric intake comes from quick service restaurants. However, a recent study conducted by the U.S. Department of Agriculture’s Economic Research Service found that junk food is actually more expensive than more nutritious fare.
Too much bad debt
When you take out a loan to get a college degree or purchase a home, you’re accruing good debt because you’re effectively making an investment in your long-term well-being. However, when you open a high-interest credit card account, you’re accruing bad debt because you’re effectively mortgaging your future to pay for your current situation. Additionally, various studies have found that taking on too much bad debt can also negatively affect your health. The stress of living beyond your means can raise your blood pressure, weaken your immune system and even cause you to experience painful migraines.
Not providing your employees with health insurance
As most small businesses operate with tight profit margins, many founders worry that offering their employees health insurance will render their companies insolvent. However, making health benefits available to workers can actually help make a small firm more successful. With access to preventative care and treatment for any chronic health problems they may have, employees are more focused on their work, more committed to their employer and are absent less frequently. Since the emotional fallout from having your business fail can lead to the development of major depression, offering health benefits is an investment in your team’s future and your own.
To learn more about affordable healthcare plans for your small business, visit Health Alliance Plan.
For more tips and inspiration for small business owners, visit CBS Small Business Pulse Detroit.