Financial Planning for a Longer Life
Planning for your future financial needs can help you live longer. It is, of course, no surprise that bad financial circumstances can have a negative impact on your health. But in a recent study, researchers found that having a broader financial horizon can leave you more prepared to face financial burdens as you age.
What Did the Future Financial Planning Study Find?
A long-term study published in Plos One following older individuals in England and the U.S. compared their attitudes toward future financial planning against their self-reported health and how long they lived. Essentially, researchers were testing if someone’s forward-looking behavior, which was how far a person looked into the horizon of their financial future, could explain their health levels and how long they lived.
The individuals in the study were separated into two categories: short-term planners who plan less than a year in the future and long-term planners who plan for longer. Researchers found long-term planners were not only more financially prepared to deal with any financial burdens they met in the future, which were usually medical, but they were also able to prevent those burdens through preventive care like getting annual cancer screenings.
Who Can Benefit from Future Financial Planning?
The study found individuals with lower incomes benefitted the most from having broader future financial horizons, meaning they plan farther into the future, as they reported having higher health levels and more financial resources as they aged. These lower-income individuals were more likely to save than spend so they were able to grow financial resources that could be used when they were older. But the study also acknowledges that substantial inequality exists in mortality rates across socioeconomic groups, especially in the U.S. where the gap in life expectancy between the richest and poorest populations can be up to a 20-year difference.
In an interview with one of the researchers, Joe Gladstone, he suggests you should try building up a savings reserve even if it is just a little bit at a time. He also suggests implementing financial tracking resources into your life, like a spreadsheet where you can track how your wealth changes and any debts you have.
Choose the Best in Future Financial Planning
At Steve Lynch Wealth Management, we recognize that everyone can benefit from financial planning regardless of their job or income. Our clients come from all walks of life, so it is important for our team to create individualized financial plans. Choose Steve Lynch Wealth Management to be your one-stop-shop for all your financial needs. Contact us and you can change your entire financial future!
This is meant for educational purposes only. Information presented should not be considered investment advice or a recommendation to take a particular course of action. Always consult with a financial professional regarding your personal situation before making any financial decisions. All investing involves risk including the potential for loss. Diversification is an investment strategy that can help manage risk within a portfolio, but it does not guarantee profits or protect against loss in declining markets.