Debt linked to mental health problems
18/05/2008
A report by the mental health charity Mind has shown that debt is a significant factor in worsening mental health, and as the credit crunch hits and the cost of living soars, this new evidence shows the extent of debt's impact - with many people forced to go without basics such as food and heating.
"In the red: debt and mental health" is the first ever survey to specifically examine the links between mental distress and debt. Of the 1,800 people questioned, 91% said that debt had worsened their mental health, and those with mental health problems were found to be almost three times more likely to be in debt due to difficulties getting a job because of stigma or due to ill health.
Mind's Chief Executive Paul Farmer said: "UK personal debt stands at
£1.4 trillion - but the real cost is on our mental health. Money worries are causing high levels of stress, depression and in some cases self harm and suicidal thoughts.
"People living with mental health problems are particularly vulnerable to being trapped in a cycle of debt and poverty. Many have become dependent on credit to pay for everyday essentials, and, to compound the problem, those on lower incomes are also more likely to only get credit from lenders who charge astronomical interest rates.
"If we are going to tackle this problem effectively, then we need to see changes in financial services such as waiving fees when a customer has been too unwell to manage their finances, and introducing mental health awareness training for bank staff."
Other findings included the fact that:
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The poorest face the highest cost as they may only be able to borrow from private or doorstep lenders who charge extortionate interest rates - thereby contributing to a spiral of debt.
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People with bipolar disorder or schizophrenia, which can cause people to spend extravagantly during a manic phase, are four times more likely to be in debt than the rest of society.
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Fear of harrassment by debt companies has led fewer than 1 in 3 people with mental health problems to tell the organisation to which they owed money about their debt, because they did not think that they would be understood. And 83% of those who did tell creditors continued to be harassed about debt repayments. In one case, a woman was called at 15 minute intervals for 13 hours.
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34% of people with problem debt did not seek advice for their debt problems, often because they did not know where to turn.
To help deal with the problem, Mind has recommended that:
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Bank and debt-collection agency staff receive mental health awareness training.
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Banks adopt a flagging system where customers can choose to have their account monitored for erratic spending to better protect their finances
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Bailiff practices are investigated when they relate to people with mental distress.
Benjamin Fry, presenter of BBC programme Spendaholics, said: "It's often the way we feel and our mental health that influences the way we spend our money or look after our finances. Money has powerful unconscious associations and the way we use it can often be an attempt to communicate some deeper distress. That needs listening to, otherwise the behaviour just continues, often escalating in an increasing cry for help."
Mind has launched a new section on its website offering information for those struggling with debt at the website linked below, and a training programme for local Mind associations across the country so that they can deliver financial surgeries.