Money and Mental Health’s new report (sponsored by Barclays) looks at people’s experiences of financial and mental health problems from 2019-2022, covering the period just before the pandemic up to the start of the cost of living crisis. Entitled ‘Always on your mind‘, it examines how people aged 25-54 (i.e prime working age) experienced this combination of issues differently depending on whether they faced them on a short term (one to two years) or long term basis (three or more years).
According to the research, 800,000 people endured a toxic cycle of entrenched mental health problems and long term financial difficulties during the years from the start of the pandemic to the onset of the cost of living crisis. It also highlights that an additional 3.4m people experienced a combination of mental health problems and financial difficulties for varying periods of time in this period – and without support, could be at risk of falling into a long term cycle of these problems as the cost of living crisis continues.
The charity’s analysis of four years of nationally representative data spanning this period demonstrates clearly that experiencing mental health problems on a long term basis has a very marked and detrimental impact on people’s financial wellbeing. People who experienced mental health problems for three or more years faced significantly worse income, employment and debt outcomes – compared to both people who have never experienced a mental health problem, and those who experienced mental ill-health on a shorter basis during this period.
In particular, the report highlights that people aged 25-54 who had long term mental health problems in this period were:
- Nine times more likely to have struggled financially than people who have never experienced a mental health problem. This is significantly higher than people with shorter mental health problems, who were just over three times more likely to have struggled financially than people without mental health problems.
- Eleven times more likely to have been out of work due to illness or disability than people without mental health problems. Again, this is a significantly higher likelihood than for those who experienced mental health problems for a shorter period of time – who were five times more likely to be out of work than those without mental health problems.
- More likely to have had low incomes – with an average income gap of £3,360 a year compared to people without mental health problems. For people with shorter-term mental health problems, the average annual income gap was £2,376 compared to those who have not experienced mental health problems.
- Nearly four times as likely to have been behind on bills than people without mental health problems. In contrast, people who experienced mental health problems for a shorter period of time were nearly twice as likely to be behind on bills than those who haven’t experienced mental health problems.
Money and Mental Health is urging the government, the NHS, regulators and essential services to work together to improve preventative support for these issues. The charity is calling for a cross-government taskforce to step up prevention measures and implement a joined-up approach to money and mental health support. That includes making finances a consideration in all aspects of mental health prevention and treatment – by ensuring streamlined, timely access to mental health and money advice for people struggling.
A cross-government and cross-sector approach to mental health and money support should also include measures such as:
- Providing money advice alongside NHS Talking Therapies – the flagship programme for treating mild to moderate mental health problems which treats over 1.2 million people each year. Money and Mental Health’s analysis suggests that doing so would help 27,000 people recover from mental health problems each year.
- More joined-up working between government departments and mental health services, money advice services and essential services firms. Measures like improved partnerships and referrals between money and mental health services and improved cross-sector data-sharing, would help to better identify people at risk of mental health and money problems. They would also make it easier and quicker for people to get the support they need.
Conor D’Arcy, Interim Chief Executive at the Money and Mental Health Policy Institute, said:
“With the cost of living crisis coming hot on the heels of the pandemic, the last four years have been a car crash for many people’s finances and mental health. Rates of mental health problems continue to be higher than before the pandemic, while the rising cost of food and other essentials have made finances a source of daily worry and anxiety.
“The country is at an important crossroads. Continuing down the same track risks millions of us being sucked into the toxic cycle of long term mental health problems and financial difficulty. Not only would that be catastrophic for those affected, it would also be disastrous for the economy and NHS.
“This research has some important good news, though. Money and mental health problems are not inevitable — there is a way out, and preventing them cropping up in the first place is even better. But to really get to grips with this issue will require action.
“The government needs to lead that work, by joining up support across vital services like the NHS, money advice as well as banks and energy firms. Without that, there’s a real risk that millions more people will face years of their lives being blighted by avoidable money and mental health problems.”
Neil Gallimore, Head of Barclays Financial Assistance, said:
“This new report shines an important light on the link between financial wellbeing and mental health, along with the need to better support the nearly 800,000 people who experienced long-term mental health problems and financial difficulties between 2019 and 2022.
“At Barclays, we have been drawing on the learnings of the report to improve how we support our customers, such as reviewing and improving our communications to those who might either already be experiencing or are at risk of falling into financial difficulty.”