Health care costs eating the young alive
Half of adults have had to prevent or delay important financial milestones because of health care costs.
Millennials and GenZers are spending so much on health care that they’re unable to pay down their debt, save for retirement or buy a house.
That’s according to a new study from Lively, which finds that while it certainly isn’t a problem only for younger people, they’re the ones most affected—in spite of being the healthiest.
Related: As if student loans weren’t enough, millennials also rack up the most medical debt
Its “2019 Wellness & Wealth: Consumer Insights” finds that 52 percent of adults overall have had to prevent or delay important financial milestones because of health care costs, such as saving for retirement (25 percent), going on vacation (24 percent) and paying down debt (23 percent. Almost 80 percent of Americans agree that rising health costs make it difficult to save for retirement and achieve financial independence, and young adults are the most affected.
In fact, according to the study, the majority of GenZers have cut back spending on such things as “fun” spending and/or hobbies (50 percent), vacations (38 percent) and paying down debt (31 percent) because of health care costs. They’re also the most likely group to postpone doctor visits (59 percent) or go only in the event of catastrophe (38 percent), and 63 percent have avoided a doctor’s recommendation due to cost.
Other activities that get put on hold because of medical costs are getting married (and forget going on a honeymoon), having a baby and starting a business. And some are postponing quitting their jobs or switching to part-time work.
In addition, the report reveals that nearly 50 percent of Americans overall are not prepared to handle the costs of their own unexpected injury and/or serious or chronic illness. Not only that, 56 percent of adults say they’re not prepared to care for a sick or aging parent—with more women feeling that way than men (at 62 percent, compared with 50 percent).
“The reality is that health care in retirement costs ($369,000 per couple) more than the average price of a home ($231,000) in America today,” says Shobin Uralil, COO and cofounder of Lively. “The data show that young people aren’t as financially independent as their parents may have been—homeownership is down and middle-class life is harder to attain. While buying a home is not essential to success, being able to take care of yourself throughout your life is. You may be stuck in a cycle of savings for future finances, while healthcare costs continue to increase.”
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