Mental health problems have devastating impact on personal finances, study finds

Almost all of those surveyed said they spent more money when they were unwell

(Getty)

Mental health issues can have a devastating impact on the personal finances of patients, a study has found.

Falling behind on bill payments and avoiding dealing with creditors are just two of the problems that can arise for those suffering from mental health issues, according to a report by the newly established Money and Mental Health Policy Institute, set up by Martin Lewis of MoneySavingExpert.com.

"Sex, religion and politics people will happily talk about all day long. Yet talking about money, that’s a taboo in polite society – heaven forbid someone admit to their friends that they’re struggling. Throw mental health into the picture and you have a degree of silence that is deafening," Mr Lewis said.

The report drew on the testimonies of more than 5,000 people to reveal that 72 per cent of people suffering from mental health issues said their problems had made their financial situation worse, not simply because they had less money to spend.

Almost all (93 per cent) of people said they spend more when they are unwell, while 92 per cent said they found it harder to make financial decisions.

More than half of sufferers (57 per cent) said they had taken out a loan that they might not otherwise have done because of their illness. Of those who took out loans, 38 per cent said that their mental health at the time they borrowed meant they were unable to remember what they had been told about the loan.

"It’s clear from the study that people with mental health problems are spending more when they are unwell, finding it harder to make financial decisions and in the worst cases, actually taking on new credit that they otherwise wouldn’t have done. This is extremely worrying," he said.

The findings show that periods of poor mental health can result in altered behaviour, leading to them making poor financial decisions or to not caring about finances at all.

The problem works both ways: one in two British adults with a debt problem has a mental health problem, while one in four British adults with a mental health problem has problem debt.

Mr Lewis and the policy institute urged people in the finance industry, at the point of sale in banks and shops and working in health professions to develop products to help people stay out of financial difficulty.