If you have even 10% of your wealth in the stock market and experience only a 10% loss, your risk of dying early, or having a physical health problem like high blood pressure or a mental health problem such as depression, increases significantly.
That’s according to a recent study published in the American Economic Journal. These losses are known as “wealth shocks,” which the study found “strongly affect physical health, mental health, and survival rates.”
Among every 100 retirees with money in the market suffering a 10% wealth shock, one additional person will die within the next two years, and 2.5 more will develop health problems.
The study didn’t examine the impact of a bigger drop than 10%, but it’s easy to imagine it would be worse.
It’s not rocket science to realize there is a close connection between your health and your wealth.
It’s not just the risk of early death and sickness you need to worry about…
The anxiety, anger, and frustration you feel caused by negative stock market returns also “makes investors more prone to driving errors and lapses.” [Read more…] “Stock Market Declines Linked to Early Death, Illness and Fatal Accidents, Studies Show”