The relationship between a person’s wealth and level of health and wellness has been known for some time. Those who have more money tend to live longer, healthier lives, but in the past, scientists are unsure of exactly how and why this occurs. A new study is investigating how a substantial loss of money can directly impact longevity.
The recent study, conducted by researchers at Northwestern Medicine at the University of Michigan in Ann Arbor, discovered that over a 20-year-time-span, over 25% of middle aged and older people in America experienced what the researcher called “negative wealth shock.”
What is Negative Wealth Shock?
The definition of negative wealth shock, according to the researchers, is when a person loses at least 75% of his/her wealth that has been accumulated.
The study, led by Lyndsay Pool, a research assistant professor at Northwestern University Feinberg School of Medicine in Chicago, Illinois, was published in JAMA. It was the first study of its kind on the relationship between negative wealth shock and longevity. Researchers measured health outcomes for people who lost their wealth, as well as those who had asset poverty (defined by the study authors as “zero or negative total net worth”) when they began the study.
The researchers examined information (from a group of 8,700 adults, aged 50 and older) from the Health and Retirement Study, designed by the National Institute on Aging. The process of gathering the data began in 1992, and continued, every two years.
Professor Pool stated, “we found losing your life savings has a profound effect on a person’s long-term health.” When Pool mentioned the word “profound,” he was not implying any type of positive effect. In fact, those in the study who experienced wealth shock, were twice as likely to die in the following 20 years (after the loss of wealth)—compared to those who did not experience a catastrophic financial loss.
“Our findings offer new evidence for a potentially important social determinant of health, which so far has not been recognized: sudden loss of wealth in late middle-or older age.”
When the study participants with asset poverty were examined, the results were similarly grim; their mortality (death) risk increased by 67%. “The most surprising finding was that having wealth and losing it is almost as bad for your life expectancy as never having wealth,” said Pool.
Measurable changes such as hypertension, depression, substance abuse and impaired heart function, are some of the physical findings that backed up the researchers’ theories (about the connection between loss of wealth and shortened life span) in the study.
The study authors surmised that the reason people who lose their wealth, (or who are impoverish during the later years) have a shorter lifespan, may be two-fold—due to depression over the loss and lack of funds, and the inability to afford medical expenses in old age. “These people suffer a mental toll because of the financial loss as well as pulling back from medical care because they can’t afford it,” said Pool.
The moral of the story is that those who plan to live past 100 well will fare better to pinch those pennies, than they will by spending them.