The Impact of Financial Hardship on Mental Health - Crossroads Health

Financial Hardship and its impact on mental health

Money doesn’t necessarily equate to happiness, but it is an essential component of our lives. When finances are tight, this can often derail the sense of mental and emotional wellbeing. Indeed, financial issues are frequently outside of people’s control and can crop up unexpectedly. This is especially evident in this current period of economic uncertainty and rising inflation.

We’re going to take a closer look at the impact of financial hardship on mental health. Where are the particularly problematic areas and what budgeting steps can be taken to mitigate challenges?

The Direct Impact

There’s no doubt financial hardship can have a direct impact on mental health. Finances are so intrinsically linked with quality of life, stability, and social status that there can be a significant emotional toll.

Some of the most common mental health experiences from financial hardships include:

●     Depression and Anxiety

A recent World Economic Forum report found those with low incomes are up to 3 times more likely to experience depression and anxiety. While this is certainly concerning, it’s also not especially surprising. From an anxiety perspective, there is a significant amount of fear surrounding the ability to maintain liquidity. This can be further exacerbated when there is debt involved. Similarly, a poor financial situation can trigger or exacerbate symptoms of depression as a result of uncertainty about the future.

●     Stress-Related Illness

Financial hardship is an undeniably stressful situation. After all, a person’s ability to care for themselves and their family depends on their financial stability. The negative pressure instigated by hardship can very quickly become overwhelming, putting additional strain on their sense of emotional wellbeing. Indeed, it is not unusual for those who have lived in poverty to experience symptoms of post-traumatic stress disorder (PTSD) related to these circumstances. This can have long-term consequences.

The Knock-On Effects

Part of the challenge with financial hardship is the impact is not simply limited to direct mental unwellness. Various knock-on effects are difficult to manage in themselves and serve to exacerbate emotional, behavioral, and cognitive functioning.

Some of the ways this can present include:

●     Physical Unwellness

It is not unusual for those living with financial hardship to find physical health suffering. This can be the result of poor access to healthy food impacting their nutrition. Not to mention the stress of poverty in itself can cause higher blood pressure. As a result of these physical health effects, there is a tendency for people’s mental health to suffer, too. Stress and anxiety symptoms commonly arise around concern about physical health.

●     Social Upheaval

Financial hardship tends to impact not just people’s immediate wellbeing but also their lifestyle. Particularly if these hardships are relatively new, there can be significant changes that occur. They may no longer be able to afford to live in the same home or even the same city. Even at the best of times, moving house can be a disruptive experience with a lot of financial and logistical responsibilities to attend to. This can trigger symptoms of stress but it is also common for people moving home to experience depression. After all, they’re having to adapt to a new and less comfortable way of life away from the support of close family and friends.

Access to Resources

The healthcare infrastructure of society is integral to how people manage their wellness. Unfortunately, it’s impossible to ignore the fact that the system in the U.S. is built upon a largely commercial structure. Those who live with financial hardship are often unable to afford all but the most basic mental health care resources.

There is also the matter of poverty decision-making. Those living with financial hardships regularly have to make tough choices. Some weeks they may have to forgo healthier food because they need gas to drive to work. As such, the added expense of copayments or therapist appointments tends to be treated as luxuries they can’t always afford. The result is usually that mental health issues caused by financial hardship remain unaddressed, locking them into a negative cycle.

Potential Solutions

There are no easy solutions to the mental health impacts of financial hardship. However, there are resources and methods available to help ease the psychological and emotional burden. These include:

●     Sliding Scale Therapy

There are an increasing number of mental health services operating on a sliding scale basis depending on patients’ level of income. The Substance Abuse and Mental Health Services Administration (SAMHSA) maintains a tracker to locate such treatment in specific areas. In-person appointments are not the only option here. There are also telehealth therapy services so low-income patients don’t have to pay additional travel costs.

●     Meditation and Mindfulness

Studies have shown meditation can be instrumental in addressing negative patterns of mental unwellness. Even brief sessions performed consistently can reduce symptoms of stress, anxiety, and depression. Regular mindfulness alongside this can help people stay aware of their state of mind and how the stresses of financial hardship are affecting them. These are low-cost ways to maintain mental health, with only time, a quiet space, and perhaps a guided meditation app needed to engage. 

●     Self-Care

Self-care activities should not be a substitute for professional mental health treatment. But they can be affordable supportive resources. Hiking surrounded by nature is known to have a variety of positive psychological effects. It can boost moods, help people manage self-esteem challenges, and generally improve brain function. Effective self-care activities tend to be personal to the individual. But making time to focus on one’s needs can be a break from the stress of financial hardships.

Conclusion

Financial hardship is not just a drain on the bank balance, it can also have a significant impact on people’s mental health. There are the direct elements of stress and anxiety caused by experiences of poverty. There are also knock-on lifestyle aspects that can exacerbate and perpetuate symptoms of psychological unwellness. These certainly aren’t helped by the reduced access to care those in poverty often live with. Nevertheless, it’s important to seek out affordable resources and activities that help to manage mental unwellness as part of a route out of such financial straits.

Guest post by Luke Smith