Spending sprees plunge mental health patients into chronic debt

Bipolar disorder can lead to impulsive buying, fuelled by borrowing at exorbitant rates

Nina Lakhani
Sunday 11 May 2008 00:00

People with mental health problems are three times more likely to be debt-ridden than the general population as personal borrowing reaches record levels in the UK.

The number is likely to be even higher among those with bipolar disorder as over-spending is often part of the condition, according to experts. They warn that financial troubles result in mental health problems such as anxiety, depression and even suicide, and urge lenders, debt collectors and health professionals to be alert as the credit crunch worsens.

The findings come on the eve of Mind Week and publication of a report by the mental health charity Mind, which says debt is leaving tens of thousands of vulnerable people struggling to find money to eat, stay warm and pay the rent.

Comedian and writer Stephen Fry (pictured below), who has bipolar disorder, yesterday called for better understanding about the links between debt and manic depression. He said: "My own bipolar condition has caused me to go on plenty of giddy spending sprees.

"Because so much stigma still surrounds mental health, many people can't get a job, are on the poverty line, and can't get credit from anyone but doorstep lenders charging up to 400 per cent interest."

Average household debt reached £9,216 (excluding mortgages) this month, according to the charity Credit Action. One in four people with mental health problems is in debt, which means that a staggering 2.5 million people are estimated to be struggling with debts while dealing with illness.

Bipolar disorder, which affects 1 per cent of the population, is characterised by extreme mood swings. During a manic or high phase, shopping sprees are common. They can extend to cars, holidays and computers, costing thousands of pounds as irrational decision-making takes hold.

During a low phase, a person may feel so depressed they are unable to leave the house or even answer the phone. Unopened bills pile up. Juggling creditors while trying to recover from an acute phase of bipolar disorder can leave them vulnerable to relapse.

Chris Fitch, of the Royal College of Psychiatrists, says financial problems are the result of more than overspending. "People with mental health problems are often on low incomes, experience high unemployment rates, and are reliant on benefits. Borrowing money or not paying the bills can often feel like the only options," he said.

Lenders must tread a fine line between not discriminating against people with mental health problems and protecting vulnerable customers whose spending is out of control as a result of illness. But many people in debt report unhelpful, aggressive responses from lenders, resulting in greater anxiety, stress and more debt.

Joanna Elson of the Money Advice Trust said: "The stress of unmanageable debt has a direct impact on an individual's physical and mental well being.

"The guidelines are voluntary but they are designed to encourage good practice by creditors, debt collection agencies and money advisers working with people with debt and mental health problems."

According to Mind's chief executive, Paul Farmer: "Living with bipolar disorder greatly increases the likelihood of falling into debt. In many cases, people are using credit they cannot afford to repay, which means they become trapped in a spiral of debt that further compounds their mental health problems.

"Banks and other lenders should not be encouraging their customers with bipolar disorder to take out more loans when they are already in lots of debt."

'I owe £35,000. The bank phones 10 times a day'

Rachael Watson, 34, a PhD student from Blackburn, has bipolar disorder, and over the past few years has racked debts of £35,000. She bought a £14,000 car, using a credit card, days before she was admitted to hospital for mania. While depressed she shopped for unnecessary clothes and food, in the hope it would make her feel more in control. Unable to face the world when she is depressed, phone calls and letters from the bank go unanswered.

Every time she got into debt, her bank encouraged her to release equity from her home to pay back what she owed. As soon as her debts were cleared, they offered her more credit. She is now being pursued by the bank, which has made her so anxious she has been prescribed extra medication. The bank phones her up to 10 times a day and sends letters demanding payments she simply cannot afford.

Nina Lakhani

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