Losing your nest egg is a health risk

Losing your nest egg is a health risk


Losing a big part of your net worth in middle age and beyond can do more than cause sleepless nights. It can significantly increase your risk of dying.

That’s the key finding by Northwestern University researchers, who concluded that people who lose at least 75 percent of their total wealth in two years are 50 percent more likely to die within 20 years.

The study was the first to assess the long-term effects of a financial catastrophe. While the rate of savings loss peaked during the Great Recession, the researchers assessed wealth shock and health outcomes over two decades.

Losing a large chunk of one’s life savings has a profound effect on a person’s long-term health, they found. And it wasn’t limited to wealthy people: More than 25 percent of Americans suffered some sort of wealth shock during the two-decade period.

The researchers believe two factors are at work. A financial loss takes a toll on mental health, and those who lose money may get less medical care because they can no longer afford it.

This is how pervasive wealth loss can be on health: The study also examined a group of low-income people who had no accumulated wealth and were considered socially vulnerable in terms of their health. Their increased death risk was 67 percent over 20 years. The researchers were quite surprised to find a similar death risk among those who had, and then lost, their savings.

Researchers want to know more about the mechanisms that lead to higher mortality after a financial setback, and whether there might be a way to offset the higher risk. For doctors, that might mean asking more questions to understand their patients’ situations.

Related Episodes