The Best Investment You Can Make

‘Tis the season of resolutions. According to a recent YouGov survey, the most common resolutions include exercising more, being happier, and saving more money. These resolutions align wonderfully with what I believe to be the best “investment” anyone can make – a pair of sneakers.

I’m a financial planner, not a doctor, so I realize that people aren’t looking to me for health advice. But health is a fundamentally important part of any financial plan. When building a retirement plan, one of the first inputs is the projected time horizon. I basically have to assess at the outset of a relationship how long that person is likely going to live.

Because financial advisors are not medical professionals, most of us simply use a default assumption about longevity. Our default is 95 years, but I often increase the default to 97 for healthy women—an age that is conservatively long but realistic for healthy people in a time of medical breakthroughs. The difficulty is that it is impossible to predict someone’s longevity, and the reality is that some people are healthier, or are more genetically predisposed to live longer, than others. Although I’m not qualified to assess the health of my clients, ignoring it seems foolish.

Beyond longevity assumptions, I’ve also learned that more than any other factor, health and long-term care spending have the potential to upend an otherwise sound financial plan. A sudden health care emergency can have profoundly negative financial implications. And more gradual health care emergencies, such as the onset of dementia, have the potential to erode even large investment portfolios.  

The financial ramifications of health are therefore critical for advisors to consider. Health and longevity will touch on almost every aspect of your financial life. It will impact decisions around how much to draw on a portfolio, what health insurance to buy, whether to consider long-term care insurance, how much life insurance to hold, how to allocate a portfolio, when to take Social Security, whether to consider annuities, and when to retire. Your health and longevity may have a greater impact on your financial plan than any other factor.

Health, wealth, and happiness are not independent objectives or separate goals—they are interconnected elements that overlap. Prioritizing one often impacts the others. Money can fund a healthier lifestyle, and good health often fuels happiness. A financial advisor’s job is to focus on a single aspect of the continuum, but managing finances in a vacuum is shortsighted.

Is there an explicit cost to hiring a personal trainer? Yes, and I’m aware that affordability is a real issue these days. Stuff is expensive. But there is likely something you can do that fits your budget and creates a positive long-term impact.

Sneakers are, of course, just a metaphor. They happen to be an inexpensive way for most people to make marginal improvements in health, by walking more. But other health and wellness goals are also laudable. Instead of new shoes, maybe it’s a personal trainer or a new bike. Instead of exercising more, maybe your goal is to sleep better and your investment is a new set of comfy sheets. Or perhaps your goal is improved mental health, in which case your investment might be therapy.

The cost of a bike or a personal trainer can create a real long-term benefit, financial and otherwise. Sometimes, the smartest investment you can make has nothing to do with your portfolio.