Debt & mental health

More than half of the UK population have experienced poor mental well-being as a result of concerns about money. Two-thirds of us have been worried about someone’s mental wellbeing linked to money worries.

What is the link between debt and mental health?

Debt is believed to be one of the biggest issues linked to someone suffering from poor mental health, and being unable to cope with everyday costs comes closely behind it with financial worries keeping one in three Brits up at night. Close to half of all working adults have had to borrow money just to make it through the month. This is despite holding down full-time jobs.

Financial wellbeing is in a similar situation as mental health, with both very much stigmatised. People don’t want to raise their hand and say they have poor mental health or are struggling financially.

When losing control of your finances and creditors, many will find that they become blinkered by the worry of debts.

Managing your finances effectively, allowing you to regain control of your finances and regain independence is the key to success. This means living within your means and not having to worry about someone knocking on your door.

Although we know effective budgeting and ‘knowing your money’ is the only way to avoid financial over-commitment and remain in control of your money, what if you have reached a point of needing help and support and can no longer think straight or feel ashamed of the situation?

How does it feel to be in financial distress?

It’s normal to feel some financial stress and anxiety at certain points in life, but sometimes the worry and burden of money worries can lead to a deterioration in both mental and physical health.

A person who is struggling with financial distress will often carry the burden rather than share their secret.

The compounding stress over the situation and uncertainty of if they will have enough to cover bills when the next paycheque can have a negative impact on their mental health.

Being in financial distress can cause sleepless nights, mood swings and extreme anxiety. It is normal behaviour to withdraw from friends and family and there will be noticeable changes in appetite. It can impact on your memory and be really hard to focus on anything other than how you will get financially back in control which will impact on your job.

It is not uncommon for people in debt to rely on stimulants such as alcohol, drugs, and caffeine making the situation worse. Ignoring the red flags can lead to a mental illness with thoughts of suicide highly probable.

What can cause money worries?

Money worries can come from a range of life events such as job loss, redundancy and a delay in getting employment and falling behind with commitments. For self-employed business owners, it could be unpaid invoices causing your business cash flow problems and inability to pay operational costs causing you to use personal money. Other issues can impact a change in family circumstances such as divorce that can result in loss of income, illness and worse the death of a partner.

Increasingly, financial concerns are playing a more prominent part in workplace stress and the problem isn’t set to go away in these economically turbulent times.

What is the scale of the UK debt problem?

Data taken from 2017 shows:

  • 276 people a day are declared insolvent or bankrupt, this is equivalent to one person every 6 minutes and 13 seconds.
  • According to the Office for Budget Responsibility, household debt is predicted to reach £2.296 trillion in Q1 2022. This makes the average household debt £84,412.
  • Total credit card debt in January 2018 was £70.35 billion. Per household, this is £2,586.

recent study by the Financial Conduct Authority found that that 4.1 million people are already in serious financial difficulty and almost a quarter of all Britons said they are struggling to make ends meet and were often worried about their levels of personal debt.

Talk to someone about it

Regardless of your position in the company, we are all open to struggles with mental health caused by money worries. That is why everyone needs to feel its okay to have a tough time with finances and it’s equally okay to reach out and ask for help.

To not reach out when your mental health is at risk is where the vicious circle starts and the decline in mental health and productivity may begin.

Whether it’s finding everyday tasks hard, like keeping on top of bills, feeling afraid viewing bank statements, or finding yourself missing payments, help is available. Talking to someone, and taking the time to focus on your well-being really is a hugely important first step even if difficult in getting your financial and mental health back on track.

If you have not yet realised the link between money and poor mental health, then look out for the following common signs in yourself and others and get help from a professional as soon as possible to avoid the problem escalating any further.

  • Change in mood
  • Increased tiredness or lack of sleep
  • Being anxious, stressed or lacking the confidence to directly contact the bank or financial service providers
  • Spending more money than is available
  • Not opening bills or post
  • Feeling like there is a lack of control over money
  • Avoiding talking about money
  • Avoiding answering the telephone
  • Not checking bank balances
  • Forgetting to pay bills
  • Changes in spending behaviour
  • Avoiding making important financial decisions

Ignoring the situation will cause the issue to escalate, Those receiving debt advice experience a huge reduction in levels of depression, anxiety and panic attacks as a result.