The mental health of our nation has been more and more in the news recently and, of course, there can be many causes of mental health issues but I wanted to highlight the connection between money worries and poor mental and physical health. We are increasingly a nation in debt as credit remains easy to get for most of us even after the disastrous effects of the sub-prime lending debacle and ensuing recession.
Anyone with a half-decent credit history can easily get a credit card but, as I always say, it is always much easier to get credit than it is to get out of debt. And there is a direct correlation between high levels of debts and anxiety and depression. According to the United Kingdom's Office for National Statistics people with experience of mental distress are three times more likely to be in debt. And people with a diagnosis of bipolar disorder or schizophrenia are four times more likely to be in debt than those with no history of mental illness.
So we know that people with existing mental health issues have problems managing debt that might simply be a regular part of modern life for others. After all a significant proportion of us have mortgages, personal loans, car loans or credit cards and manage those debts successfully. The issue is not debt per se but it's access and control.
But what about those people who have no history of mental illness who are becoming ill because of their rising amount of debt. This is a chicken and egg situation because would those people have developed mental health issues anyway and is their debt just one of many causes?
Many people have money problems at some point in their lives for a variety of reasons: they lose their job, become too ill to work, a relationship breaks down. But it's also fair to say that some people bring their money troubles on themselves because they wilfully borrow more than they need or are easily able to repay – even in these times of more stringent affordability checks for home loans it is still relatively easy to get a credit card or car loan and many people become almost addicted to material possessions. Some even believe they are better off than they really are while borrowing and spending compulsively and well beyond their means. Yet already there have been alarms bells ringing about how easy it is to get a car loan and how new financing methods mean car loans could be the next sub-prime crisis.
According to America's Debt Help Organization debt.org you have too much debt if your borrowings amount to more than 10% or your post-tax income – excluding your mortgage or rent payments. If you include home loan of rental payments along with other loans and borrowing then your debt should amount to less than 36% of your income.
But whatever way a person has got into serious, unmanageable debt – through no fault of their own or through compulsive, destructive spending and borrowing habits – the effect of debt on mental well-being is the same. Debt induced anxiety can prevent us from sleeping properly, which, in turn, leads to exhaustion and stress. As stress builds it can lead to physical and psychological problems such as depression, where people shut themselves off from day-to-day activities. It is not unknown for money worries to cause people to take their own life.
So it is essential to get help as soon as possible if debts are spiralling out of control because your very physical and mental health depend on facing and tackling the problem.