We plan to investigate how self-assessed health shapes the appreciation of consumption of people, the marginal utility of consumption. We implement the analysis using data on consumption growth rates and self-assessed health by various groups of the elderly population. The results of the project will tell us how consumption is valued in different health status and how savings responds to changes in health. An additional result of the proposed work will be an assessment of how people view that their health responds to their efforts and their out of pocket expenditures. Another outcome of the project is a measurement of the welfare costs of inequality when health and differential mortality are taken into account.