Health and wealth don’t just sound like they go together. These days, it’s tough to separate them. And it’s not just because the biggest causes of bankruptcies every single year in this country are medical problems. Even if you have substantial financial resources, poor health will eventually wreak havoc on your bank account. And health without money? That may be possible for people who are in their 20s or 30s. But as we age — and add people like physical therapists and chiropractors to our contacts — we need more in the way of resources to stay that way.
That realization was what lead me — and Dr. Michael Roizen, the Chief Wellness Officer of the Cleveland Clinic — to team up to write AgeProof: Living Longer Without Running Out Of Money Or Breaking A Hip. When we first put our heads together, we figured we’d deal with health in one section and money the next. But the more we talked, the more we recognized that the same tools can improve your life in both areas. And, even better, when you get stronger in one, the other tends to come along for the ride. Here are five you should put in place right now.
Every plan for change needs to begin by figuring out where you are. In the arenas of money and health, that means going through a series of assessments that can help us pinpoint our starting point so that we can, from there, benchmark our way to our goals. Physically, some of these assessments (blood tests) require a visit to your doctor. But others don’t. Can you walk a mile in under 18 minutes in your 20s, under 20 minutes in your 40s and under 26 in your 60s? If not, work on that. And have you taken the tape measure test? The measurement around your waist should be less than half your height in inches. (It’s okay to suck in, by the way. Dr. Mike says everyone does anyway. ) Financially, start by looking at what you earn, what you own and what you owe. The first two markers should be heading steadily upward, with debt heading in the opposite direction, with the goal of wrapping up your mortgage payments around or shortly after retirement. Next, what’s your debt-to-income ratio? That’s your total monthly debt payments divided by your gross income. Although you can get a mortgage with a ratio as high as 43%, closer to 36% is best. The more of your income that’s already allocated to debt repayment, the less flexibility you have to maneuver around surprises or take advantage of other opportunities. Finally, what sort of path are you on toward retirement? We’ve talked about benchmarking your way there in other articles. But in a nutshell, by the time you’re 30, you want to have saved 1x your current income toward your future. At 40, you should have 3x. At 50, 6x. At 60, 8x and by the time you retire, 10x. The point of these benchmarks, developed by Fidelity, is to (in tandem with Social Security) help you replace 85% of your pre-retirement income over a 30 year retirement.
The next logical question is: How on earth am I going to save so much money? And the answer is: You’re not going to require yourself to think about doing it every time you get paid. You’re going to automate instead. This is the magic of 401(k) retirement accounts. The money comes out of your paycheck and goes to work in a pre-selected portfolio of investments automatically. You don’t have to think about it every time you do it. The trick is to automate other financial needs as well, including contributions to other accounts like emergency savings, IRAs, HSAs and 529s. You’ll also want to automate bill payment so that you’re never late (because people who are late are not typically late once — they’re late chronically, and the cost of that adds up.)
Automation doesn’t apply as elegantly to health as it does to your finances, but you can semi-automate. How? By coming up with a few healthful breakfasts and lunches that you can put on auto-pilot by always keeping them at the ready. Then you only have to think about dinner. And using your calendar can keep you accountable for regularly scheduled workouts and check-ups. For example, if you know that you always get your teeth cleaned on your birthday and half birthday, it’s a lot easier to maintain the cadence.
There’s a reason it takes smokers an average of 19 tries to quit. Breaking a bad habit is hard. Replacing it with a better one? Much, much easier. So, perhaps that second glass of wine you’ve been pouring toward the end of dinner turns into a healthful piece of dark chocolate instead. The frothy coffee with the (fattening and expensive) additives you’ve been buying three times a week, becomes a plain brew with a splash of milk and cinnamon (less fattening and cheaper). And the increasingly large number of hours you spend staring at screens? Use that to make sure you’re getting a full seven to nine hours of sleep.
Build a team.
Finally, in both areas there is no saying you have to go this alone. In fact, you shouldn’t. Having professionals – doctors, nutritionists, financial advisors, attorneys – you can turn to for expert advice when needed is a must. And finding a friend who you can rely on to keep you accountable is a plus. Simply talking through your health and financial goals with people you trust is one great way to stay on track.
And, by the way, if you’re looking to put these health and wealth tactics into practice — check out the The 401(k) Race For Financial Fitness™, sponsored by The Smarter Tomorrow Foundation™. It’s an amazing event that happens every March in Orlando, and helps to support community financial literacy programs.
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