A Monte Carlo Analysis on the Security and Health Benefits of Physical Exercise for Thai Baby Boomers
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Abstract
Monte Carlo simulation is applied to measure exactly to what degree regular physical exercise helps Thai baby boomers to improve family security (the ability to support loved ones) and health (freedom from sickness), which are ranked highest in their generational value system. The analysis examines comprehensive retirement planning, which incorporates stochastic lifetime incomes, expenses, savings and investment returns together with mortality and morbidity data. Based on 5,000 simulated scenarios, the study finds that regular exercise improves health and family security significantly. Longevity increases by almost two years, while the probability of being non-communicable disease (NCD)-free goes up to more than 18%. Although on average Thai baby boomers are income-deficient and their bequests are negative, regular exercise can lessen negative bequests by more than 150,000 baht. Exercise offers much higher benefits if baby boomers start it early in their lives.
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