What is your understanding of the link between debt and mental health?
The Money & Mental Health Institute in the UK claims that mental health and debt problems go hand in hand. In fact, the statistics released by the institute show that more than 3 million people in the UK suffer both financial difficulties and mental health problems. And you can only imagine that these numbers soar as the economy fluctuates.
The Money & Mental Health Institute carried out a survey in 2016 that involved 5,500 people who already suffered mental health problems. The outcome of the survey stated that a whopping 86% of the participants said that their mental health problems were exacerbated by a problematic financial situation. Hopefully new statistics will be released this year that show an improvement, but that’s unlikely.
The shocking truth about the link between mental health and debt is quite scary. The statistics say it all and should be taken seriously into account. If you have ill mental health, it can certainly affect your finances, and of course vice versa.
In fact, debt is actually a trigger for more serious health concerns such as depression and anxiety. In fact, people who have money problems are twice as likely to plunge into deep depression than people who are financially stable. That’s a worrying thought, given the state of the world’s poverty at present.
Mental Health Problems and the Triggers that Lead to Debt Issues
Mental health problems and concerns such as relationship problems, physical health problems, mental health treatments, and cognitive impairment can all trigger poor financial management behaviours such as:
- Loss of income or low income (sometimes a direct result of inability to concentrate, emotional outbursts, depression).
- Higher spending or impulsive spending habits.
- Poor financial understanding or a sense of not caring about financial responsibilities.
Of course, all of these triggers and behaviours have a domino effect which impact severely on an individual’s finances resulting in:
- Ongoing debt
- Loss of assets, valuables and possessions
- Loss of savings
- Lower grade housing/unsuitable housing
- Poor credit rating
- Poor quality of life
- Legal action/battles
People in this type of situation may feel the overwhelming desire to stop the cycle, but it’s not as easy as just wanting to get out of it. Sometimes a great deal of support and strategic financial planning is required.
Support and Help with Debt is Needed to Break the Ties Between Mental Illness & Debt
Without support and guidance, those suffering mental health problems such as depression, bipolar disorder, and even anxiety, can find themselves in a destructive financial cycle that only leads to more serious debt. This often results in poor family relationships and sometimes even homelessness. Even the UK benefits system has contributed to the link between debt and mental health problems. It can be considered confusing and isn’t particularly designed for the understanding of those suffering with poor mental health.
There are various help and support services available in the UK to assist those suffering with the burden of both mental illness and debt, and to better understand and access the benefits system. Rethink is one such organisation that is worth checking out if you’re in need of some support and advice, as well as help with your finances.
Getting into Debt Doesn’t Mean You’re a Bad Spender
Understanding how and why people get into debt is important when it comes to understanding the link between mental health and debt. People often believe that someone with debt has been living an extravagant lifestyle and going wild with their credit card, but while that can be the case, often it’s not. In some instances, debt occurs from more innocent and serious life realities such as redundancy, unemployment, loss of a loved one, retrenchment or even through low income. And moreover, these problems or triggers can happen to just about anyone.
Problems that can affect anyone such as illness, divorce, and rising cost of living can suddenly mean that you cannot afford to pay for your car, rent, credit card bills. And here, the only solution can be to adjust to the financial change, which in itself is a major challenge. Perhaps the financial difficulties are permanent, or perhaps with the right debt help, they can pass and end up being a temporary proverbial ‘bump in the road’.
How Does Mental Health Really Affect Managing Your Finances Correctly?
As already mentioned, people with depression, bipolar disorder, and anxiety are usually more prone to debt problems, but it’s not the mental health problem itself that leads to money concerns. It’s the effect that these problems have on a person. Here are a few ways in which the impact of mental health on a person can affect income/finances:
- Low energy levels (leads to lack of upkeep of bills and finances)
- Making rash decisions (leads to unwise spending)
- Time off work (leads to reduced income or losing a job)
- Being admitted to hospital (results in time off work and mounting bills)
- Ongoing treatment (leads to expensive bills and less cash flow)
In Closing: What to Do if You Suffer Mental Health and Debt Problems
In the UK, people who need debt help and people with mental health problems are provided with various platforms to acquire the kind, understanding, and discreet help that they need. Debt help and mental health support should be sought out.
Any of the following routes can be taken if you have mental health and debt problems, or if you know someone who does (all of these services are available for free):
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