44% with mental health problems have crisis debts

Mental health problems can cause severe debt; severe debt can cause mental health problems. The sheer scale of this national problem is hidden, as both issues carry a stigma.

In a new poll of 6,700 people, 44% of those who’ve had mental health problems (or have partners who do) have had severe or crisis debt – five times as many as everyone else (9%). For those with mental health problems, big debts are the norm.

To help address the problem, MoneySavingExpert.com has this month launched a campaign to tackle the marriage made in hell of mental health and debt, including a major new free guide for sufferers and their carers.

The ‘Mental Health & Debt Help Guide’ claims to be the first detailed guide of its type and aims to provide help and info for those with mental health and debt problems and their family, friends, carers and counsellors.

The free 40-page PDF booklet was written with guidance from several leading charities including Mind, Rethink, Christians Against Poverty and others. It includes help on where to find free one-to-one debt counselling, working with banks, tips for bipolar and depression sufferers and how friends and carers can help.

Martin Lewis, creator of MoneySavingExpert.com, comments: “Those who have never experienced problem debt often consider it to be a purely financial issue – it’s not. It can break up families, take the roof from over your children’s heads, kill confidence, pile on stress, cause depression and even cause some to take their own lives.

“As the UK’s biggest money site, we can no longer divorce how people deal with debt emotionally and how they deal with it practically. I’ve often argued we need to focus on responsible borrowing, as you can’t expect lenders to be responsible – their job is flogging debt. Yet with so many suffering from mental health problems, as a nation we need to think about how we help those who, often temporarily, cannot be responsible for themselves.

“We need to do some joined up thinking to tackle this, such as banks allowing people to voluntarily register their mental health problems – so banks can track unusual spending patterns, then cut off accounts until a trusted friend says it’s ok – or other creative approaches. We must consider how to help people take control.

“As debt problems tend to lag a recession, these days the suicidal emails we receive from people in debt are a regular, not surprise, occurrence. We’ve already heard from people that launching this guide has made them feel better, because they realise they’re not the only ones suffering.”

John Kirkby, founder of UK-wide debt-counselling charity Christians Against Poverty, comments: “Life can be seriously miserable when you’re dealing with problem debts. For the vast majority of our clients, these debts are not the only stressful thing going on in their lives. There’s often relationship breakdown, illness or job loss all adding to the pressure. Feelings of hopelessness and isolation can quickly affect mental health. The good news is we see these same vulnerable people become debt free every day and this great guide from Martin Lewis and his team shows there is hope.”

Paul Farmer, CEO of mental health charity Mind, comments: “Living with unmanageable debt is known to cause problems such as depression and anxiety, but the tactics of debt collectors can be one of the worst stressors of all. Mind has spoken to people who have been hounded day and night by debt agencies, had their houses invaded by bailiffs and have had to pay fees for the privilege many times greater than the original debt.

“When people’s mental health deteriorates, it can be even harder for them to deal with debt, and the more their debts add up, the worse they feel, setting up a cycle of debt and despair that is very difficult to break. Moneysavingexpert’s new guidance should be a first port of call for anyone worried about the impact of debt on their lives, so they can manage their money and seek advice before it gets out of hand.”

In Scotland, Citizens Advice Scotland (CAB) has seen a 50% increase in consumer debt levels over the last 5 years and in 2007/08 the Scottish Bureaux dealt with £198 million of debt, the majority of people coming from low income households, often living with an illness or disability.

70% of CAB clients were living on less than £1200 per month and regardless of whether or not they were already living with an illness, nine out of ten clients said debt had a negative impact on their health, particularly their mental health.

The Scottish Government has recognised that money advice and information services tackling debt issues are key to reducing poverty and social exclusion and have invested in the training and funding of advice workers.

The Royal College of Psychiatrists (RCPsych) have been working with both the advice and finance sector to provide resources, tools and guidance around debt issues.  Final Demand published in 2009 is a guide aimed at social care workers to help them recognise some of the signs of a debt problem and how to offer support to help people begin to address the problem.

Money Advice workers in Scotland have much more awareness now about mental health issues thanks to the work of Money Advice Scotland (MAS). Over the last two years (MAS) have promoted the use of the Mental Health Evidence Form and provided training and seminars on debt and mental health issues to help advice projects across the country provide a better service.

Further information & resources

www.moneysavingexpert.com/mentalhealth
www.moneyadvicescotland.org.uk/
www.moneyadvicetrust.org/
www.rethink.org/