A new medical study has highlighted a clear association between a sudden loss of wealth and a “significantly increased risk” of death.
The report published in The Journal of the American Medical Association drew upon a study of 8,714 adults aged between 51 and 61 years when the study began.
It found that those who suffered a “negative wealth shock” over the 20-year study were much more likely to suffer long-term health consequences, with a mortality rate double those more financially fortunate.
The report’s authors, Lindsay Pool, Sarah Burgard and Belinda Needham, defined a negative wealth shock as a loss of 75 per cent of more total net worth within a two-year period.
The mortality rate over the 20-year period was 3.06 per 100 people for those who did not suffer a wealth shock, compared with 6.49 for those who did. Those who entered the survey in asset poverty had 7.34 deaths per 100 people.
“A negative wealth shock in late middle and older age may lead to permanent change in economic status because income-earning potential is reduced and thus there is less ability to financially recover from the shock,” the report’s authors said.
“Furthermore, because medical expenses from major illness can be a primary trigger of negative wealth shock in middle-aged and older adults, it can be difficult to disentangle the effect of negative wealth shocks on subsequent health outcomes from the effect of the medical illness itself.”
Nevertheless, the study found an association between wealth shocks and higher mortality rates.
It also revealed that women, racial minorities, those with lower levels of household income and the unmarried and unemployed were also overrepresented among those who suffered a negative wealth shock.
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Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.