The cost of your unhealthy habits!

Updated: Jul 31, 2019

Many of our poor habits not only wreak havoc on our health, but can also severely affect our finances. Do you know to what extent your unhealthy habits are coining it, at your expense?

While we may be temporarily able to ignore the long-term health implications of what we expose our bodies to, a closer look at our bank accounts make the financial implications plainly obvious. Life insurance premiums, health risks and their associated medical expenses, and the amount of money we spend on the actual products feeding our unhealthy behaviors, are frightening. We take a look at the financial affects of three common unhealthy habits. Do you know how severely your vices affect your finances?



Smoking

Estimated costs:

· Excluding life insurance premiums and potential medical costs

· Based on the average South African smoker’s consumption of a pack a day, at R30

· Yearly = R10 080

· After 5 years = R50 400

· After 10 years = R100 800

Smokers are coughing up increasingly more money, for shorter life spans.

The health consequences associated with smoking are no secret. Smoking has been linked to various cancers, heart attacks, strokes, cardio vascular diseases, lung diseases and stomach ulcers. The Medical Research Council of South Africa estimated as far back as 1994, that for every R1 the government received from taxes on cigarettes, it spent R2 treating chronic illnesses and lost productivity caused by the habit.

“Because smokers are more likely to die prematurely, they pay more in life insurance premiums,” says Dr. Yussuf Saloojee, Executive Director of the National Council Against Smoking. When applying for life insurance, a company will perform blood tests to ascertain whether you are a smoker or not. “The difference in increased premiums varies based on the other characteristics of the person in question,” says Dr. Maritha van der Walt, Chief Medical Officer of Discovery Life. “Using Discovery Life’s premium rates, it can be as high as 62% more than a non smoker,” notes Dr. van der Walt. This should come as no surprise considering, according to Dr. Saloojee, approximately one person dies every six seconds, globally, due to tobacco, accounting for one in 10 adult deaths.

“There is no safe level of smoking,” says Dr. Saloojee, and as a result even casual smokers may be required to pay higher life insurance premiums if their blood test conveys that smoking has had a material effect on their health.

Medical costs as a result of reliance on tobacco are also shocking. A study released by the American National Centre for Health Statistics states that, “expenditures increase with the amount smoked among males and females so that lifetime medical costs of male heavy smokers are 47 percent higher than for never-smokers.”

Companies, in addition, lose money by employing smokers. “Smokers are ill and away from work about 45% more often than non-smokers, thus reducing productivity in all industries,” maintains Dr. Saloojee. In addition smokers lose money on the resale value of their homes and cars, because of the smell that is almost an immediate turnoff to some potential buyers.

Alcohol

Estimated costs of beer-drinking at a restaurant/ pub:

· Excluding potential medical costs

· Based on a total of 5 drinks a week

· Based on the average price of beer at a restaurant/ pub, R18.75

· Yearly = R4 500

· After 5 years = R22 500

· After 10 years = R45 000

Estimated costs of wine-drinking at home:

· Excluding potential medical costs

· Based on the average price of a middle-of-the-range bottle of wine, R40

· Based on a bottle of wine a week

· Yearly = R2 080

· After 5 years = R10 400

· After 10 years = R20 800

Remember: Expect to fork out more money if you are drinking cocktails, or spirits, especially at a restaurant or bar.

Drinking, and especially abusing alcohol, can get expensive.

Stephan van Niekerk, head of Momentum’s Myriad observes that South Africans drink much more alcohol than is recommended. “The World Health Organisation’s global status report for May 2014, found that individual South Africans (15 years or older) consumed on average 8.2 litres of pure alcohol per annum. This is well above the African continental average of 6 litres,” he says.

“Medically acceptable alcohol usage would not affect life insurance premiums, but harmful drinking will be assessed and the risks will be rated accordingly,” says Dr. van der Walt. People who have higher risk, will receive higher premiums. “Assessing the risk takes various factors into account – for example the declared intake, liver tests, other blood tests as well as signs of alcohol-related damage to the body,” she observes.

The World Health Organisation recommends, that women have no more than two drinks a day, while men should have no more than three drinks a day. While you may not exceed these guidelines, the UK National Health Service observes that, “Most people who have alcohol-related health problems aren’t alcoholics.” You could therefore pay more for your good health, as a result of slightly exceeding the recommended amount of alcohol intake on a regular basis.

Poor eating habits

Estimated cost of fast food consumption:

· Excluding life insurance premiums and potential medical costs

· Based on the cost of an average combo meal at a South African fast food outlet, R45

· Based on a couple’s consumption of one combo meal each, per week

· Yearly = R4 320

· After 5 years = R21 600

· After 10 years = R43 200

Poor eating habits plague the majority of South Africans. “According to the South African National Health and Nutrition Examination Survey conducted in 2012, 64% of women and 30% of men in South Africa are overweight or obese,” says Dr. Julia Goedecke, specialist scientist for the South African Medical Research Council.

“Obesity is associated with increased risk for cardiovascular disease, diabetes, osteoarthritis and certain types of cancer,” says Dr. Goedecke. As a result of the extreme risks of obesity, according to Liberty Life, obesity could severely affect your life insurance premiums, and could even result in them being declined. Liberty’s records show that a person with a BMI of 50 is almost three times more likely to die in any given year than a person with a BMI of 25.

It is difficult to estimate the exact percentage increase to one’s life insurance premiums as result of obesity, because it is based on a combination of factors, such as age, lifestyle, past health issues, cholesterol levels and blood pressure. However insurance company Old Mutual gave us an indication of how obesity could affect your life insurance premiums:

· It has been estimated that premiums could be from 25 to 300 percent more than the average person’s.

· “The younger the age, the higher the percentage increases in premium because the risks are higher at a younger age,” says Dr. Peter Bond, Chief Medical Officer of Old Mutual.

· “A client aged 25 years with a BMI of 40 may pay 150 percent extra, whereas a client of 60 years with the same BMI may only pay 50 percent more,” says Dr. Bond.

A 2013 study was published by PubMed on the increased health expenditures of overweight and obese people, enrolled in a comprehensive Discovery Health Medical Plan. The study states, “Severely obese individuals used 23 percent more, and moderately obese individuals used 11 percent more medical services.” In fact, the lifelong costs of obesity have been estimated to be similar to that of a smoker.

It has also been found that just being overweight can increase your medical bills by 8 percent per year.

In 2012 South Africans spent more than 62.3 billion Rand on eating out alone. The percent increase in the household expenditure on fast food in South Africa, from 2007 to 2012 was 5.4 percent, while the UK only showed a 1.1 percent growth.

Overweight people have generally higher food, and clothing costs than the majority of people. They have also been found to have decreased productivity and lower incomes as a result of illness and missing work. Many studies have linked obesity to lower incomes over the first two decades of an individual’s career, and fewer promotions. Recruiters, in addition, have been found to be less likely to hire overweight people.

Are you living it large? (Sidebar)

Research has found that certain bad habits can make you fat! Are your habits influencing your weight?

1. Do you skip meals? The American Journal of Epidemiology observes that skipping meals could be contributing to your weight gain. Individuals who skipped their breakfast were 4.5 times more likely to be obese.

2. Do you eat quickly? You need an average of 20 minutes to register that you are full. It has been found that your BMI could be up to 11% higher if you eat too quickly.

3. Do you eat while you are busy? Meals in front of the TV, while reading or in front of your computer mean that your attention will not be on your food. You are more likely to overindulge.

4. Do you eat out of the packet? It is difficult to figure out portion size when eating straight from the packet.

5. Do you watch too much TV? A recent study found that people who cut down on time spent in front of the TV burnt up to an extra 500 kilojoules more in a day, than they did previously.

Sources: Dr. Maritha van der Walt; Dr. Yussuf Saloojee; Dr. Julia Goedecke; Stephen van Niekerk; www.hst.org.za; www.discoverey.co.za; www.yourlife.liberty.co.za; www.nhs.uk; www.ncbi.nlm.nih.gov; www.cnbcafrica.com; www.oprah.com; www.menshealth.com; www.numbeo.com


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