Monthly Finance Message:

Small Steps to Health and Wealth: A 10 Year Retrospective

July 2014

Barbara O'Neill, Ph.D., CFP®
Extension Specialist in Financial Resource Management
Rutgers Cooperative Extension

2014 marks the 10th anniversary of the Cooperative Extension Small Steps to Health and Wealth™ (SSHW) program which encourages Americans to simultaneously improve their health and personal finances. The program was developed after its creators started researching dozens of relationships between individuals' health, personal finances, and wealth accumulation.

Others had also noticed strong relationships between health and wealth. The book Getting Rich in America: 8 Simple Rules by Dwight Lee and Richard McKenzie discusses maintaining good health as a major factor associated with wealth creation. The authors point out that healthy people are often more productive at work and more likely to get promoted and earn larger salaries than unhealthy people. They also have fewer work absences and out-of-pocket medical expenses that erode their wealth.

A healthy lifestyle also increases a person's chances of living longer. Thus, another financial benefit of good health is that people live long enough to collect their Social Security and pension benefits and earn a good return on annuities. There is a flip side, however. Healthy people also need more retirement savings to sustain themselves over three, perhaps even four, decades of life after they leave full-time paid employment.

Another impact of good health upon wealth, according to Lee and McKenzie, is that, the longer one lives, the longer compound interest works its magic to increase the value of your savings. This point was brought home in the 1990s, when a 91-year old woman in Sussex County, New Jersey died and left about $3 million to local charities. She was a school teacher, who never made more than $16,000 a year before she retired.
People were amazed at both her generosity (her bequests were a surprise), as well as her wealth, and the fact that she was, quite literally, "the millionairess next door" and nobody knew it.

"How could she possibly have had all this money,?" people asked. Further examination by local newspapers revealed that she did everything that "millionaire books" at that time were advising: she lived below her means, shopped wisely, had a low amount of debt, bought and held high quality blue chip stocks and growth mutual funds, invested the maximum allowed by law in a tax-deferred 403(b) retirement savings plan, and, most importantly, had seven decades of compound interest on her side to build wealth slowly over time.

Lee and McKenzie also talk about the financial impact of eliminating specific unhealthy behaviors. They give an example of investing $1.50 a day saved by not consuming junk food from age 18 to 67 (the full retirement age for younger workers). What is the result? Almost $300,000 of savings at an 8 percent rate of return. Bump that amount up to something more expensive, such as a $7.00 a day pack of cigarettes or latte and donut habit, and you're talking about the difference between becoming a millionaire several times over at retirement...or not. As this example illustrates, small steps do make a big difference!

As you will see throughout the SSHW Web site, there are many similarities between health and personal finance "issues" (i.e., problems such as obesity and high household debt) and behavior change strategies that can be put into practice to improve both health and financial security. Since there are many fine books and programs available to teach people how to save and invest, get more physical activity, or eat better, SSHW focuses on strategies to change behavior. Each of the 25 behavior change strategies described in the SSHW workbook contains a worksheet for people to apply it to their lives.

Remember, what people think about, they bring about. Join Cooperative Extension in celebrating the 10th anniversary of the Small Steps to Health and Wealth™ program by visiting the SSHW Web site and taking positive action to improve your health and/or finances. Be healthy, wealthy, and happy!


  1. Rutgers
  2. Executive Dean of Agriculture and Natural Resources
  3. School of Environmental and Biological Sciences