Counting Calories Helps Your Retirement Account, Too

(Bloomberg Opinion) -- Before those celebrating Thanksgiving reach for a second slice of pecan pie, they should consider this: A 55-year-old woman with Type 2 diabetes will pay an average of $3,470 more a year in medical-related expenses, or close to $160,000 in total, than if she didn't have the disease.

A one-time indulgence on a holiday certainly won't result in diabetes, but it's a good reminder that making the right food choices over time can have just as much of an impact on retirement savings as market forces and investment decisions. Minimizing the costs of aging is equally as, if not more than, important as maximizing retirement income.

Type 2 diabetes (along with its precursor, pre-diabetes) are prime examples since they're largely preventable by eating right and staying active. Those who suffer from them get hit financially because they don't necessarily shorten life expectancy; they allow people to live but with expensive health-related conditions — often incurring out-of-pocket costs that may not be covered by Medicare or insurance companies.

One study of Medicare beneficiaries showed that prescription medicine is the biggest driver of additional out-of-pocket costs for heart disease, diabetes and high blood pressure. Those with diabetes are also more likely to require costly organ transplants or long-term care, which Medicare doesn't cover.

Many people ask me for financial advice when it’s nearly too late. A 53-year-old colleague admitted she had no retirement savings and asked what she could do. Telling her to save 50% of her earnings to adequately supplement Social Security seemed cruel and unrealistic. So, I pivoted. I concentrated my tips on how she could reduce expenses as she gets older. The most direct and cheapest is to avoid the preventable diseases that will drain your wallet. Let’s call it downsizing.

Another important and easy way to minimize health-related costs is to take your medicine. Only about 50% of U.S. adults who suffer from a chronic condition take their medications as prescribed. While some may not take medicine because it's too expensive, skipping it can often wind up being far more costly following emergency-room visits and other avoidable medical expenses.

Sadly, most retirement advisers don't usually focus on how dietary and other lifestyle changes can help to avoid costly chronic conditions. And medical professionals don't talk about financial issues enough. Daniel Levitin, a neuroscientist and aging expert, wrote a bestselling book last year called “Successful Aging,” but he hardly mentioned money. I realized that the books I write about money barely mention health. We're both wrong.

More than half of baby boomers now say they're worried they won't be able to cover medical expenses in retirement. They should remember that rethinking their meal choices at Thanksgiving and beyond could go a long way toward making their retirement more comfortable.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

Teresa Ghilarducci is the Schwartz Professor of Economics at the New School for Social Research. She's the co-author of "Rescuing Retirement" and a member of the board of directors of the Economic Policy Institute.

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