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Debt and Mental Health

One in four people will experience a mental health problem during their lifetime . The links between debt and mental health are clear. Being in debt can negatively affect a person's mental health, while living with a mental health problem increases the likelihood of falling into debt.

Mind commissioned the Royal College of Psychiatrists to carry out a new piece of research in this area in December 2007 and January 2008. The research involved a survey of the experiences of debt among 1,804 people living with mental distress or using mental health services, as well as eight focus groups that were held across England and Wales involving 56 people with experience of debt and mental health problems

The research focused on their use of credit and loans over the preceding 12 months, and the impact of debt problems on health and quality of life. It also considered the respondents’ experiences – good and bad – of contact with banks, lenders and creditors, and their perception of the support available to those living with debt and mental health problems.

What the research found

Our research revealed that a large proportion of respondents were struggling financially and were finding it difficult to regularly meet payments. As a result of this, over three-quarters of respondents with problem debts had been threatened with legal or court action and over half had been contacted by bailiffs or debt collectors. The research found that of those with problem debt(1) (924 respondents), 91per cent said that debt had worsened their mental health.

“The worry of the debts and not being able to pay bills just makes everything seem worse and you feel as if things will never change and you will never be able to pay or catch up with arrears. When you receive threatening letters for possession or to be taken to court or even with bailiffs, it makes everything bleaker. And suicide becomes more inviting the more the letters arrive.”

 The fact that people are experiencing problem debt has a direct impact on how they live. People reported having to cut back on food, gas and electricity.

I am unable to buy food some weeks. I have no social life. I live four miles from the nearest bus stop and have no transport and have to walk four miles each time I go to work or the shop.”

(2) In the report we defined 'problem debt' as occurring when a person has been two or more consecutive payments behind with a bill in the last 12 months.

People also reported a reluctance to disclose their mental health problems to their creditors. Those that did confide felt they had not been treated fairly afterwards. The findings reveal an urgent need for safeguards that enable people to protect their finances when they are unwell.

(1) Goldberg D. and Huxley P. (1992), Common mental disorders – a bio-social model, Routledge

(2) In the report we defined 'problem debt' as occurring when a person has been two or more consecutive payments behind with a bill in the last 12 months.

“Because I do not have any disability that anyone can see it’s as if I am pulling a fast one and pretending. It is real and it is shocking and painful. It’s like a curse … the establishment treat me like a scrounger.”

A large proportion of respondents who were experiencing problem debt were in contact with mental health services, but less than a quarter had spoken to a mental healthcare professional about this. This demonstrates the need for a more holistic approach to support in health and social care to promote financial education and capability.

 Creditors and debt advisers working with people with mental distress and problem debt may require medical evidence, which can prove difficult to obtain and lead to delays. There needs to be better coordination and a sharing of appropriate information between health and social care professionals and debt advisers.

Our survey revealed that many people have difficulty accessing debt advice services. Reasons for this included a lack of knowledge about how or where to access services, feelings of embarrassment and inability to access services due to a lack of resources or inflexible appointment systems.

Existing advice services need to understand the relationship between debt and mental health problems and work with the financial industry and other creditors, with support from the healthcare sector, to address this pressing issue.

For further information on the campaign and its key findings please visit the Mind website:

With the current rising costs of everyday items such as food and fuel, Mind’s new campaign - ‘In the Red’ - gives powerful evidence that people with a mental health problem are far more likely to face problem debt than the rest of the population.

The launch of the campaign

In the run-up to the launch of the campaign, Mind met with a number of the finance trade bodies to brief them on the campaign and to explore how Mind can positively engage with them in achieving the campaign’s aims.

In the run-up to the launch of the campaign, Mind met with a number of the finance trade bodies to brief them on the campaign and to explore how we can positively engage with them in achieving the campaign’s aims. Since the launch Mind has been meeting with the remaining finance trade bodies and Government departments including Department for Work and Pensions, Ministry of Justice and to discuss the campaign aims.

The All Party Parliamentary Group (APPG) on Debt hosted a meeting on the ‘In the red’ campaign, jointly with the APPG on Mental Health on 18 June 2008. The speakers included representatives from Mind, Citizens Advice, APACS (The UK payments association) and a mental health service user with experience of debt and a audience of parliamentarians, and representatives of the banking industry and other interested organisations.

How you can get involved

  • Email your MP via the Mind website ( to ask them to support our Early Day Motion (EDM) on the campaign, EDM 1527. We’re already had over 60 signatures, but would like to see many more.
  • Read Mind’s In the red report. You can download it from the Mind website or contact the Campaigns team on 020 8215 2424 for a hard copy.
  • Visit your MP or Welsh Assembly Member (AM) to discuss the campaign and draw their attention to the new Mind research. Remember, where possible, to also highlight your own experiences of debt problems and financial difficulty
  • Write to the head of your Primary Care Trust (PCT) in England or Local Health Board (LHB) in Wales to ask them what they will do in response to the In the red campaign demands. Contact details for PCTs are available at the NHS Choices website and for LHBs at the Health of Wales information website.

Making complaints if you’ve had a bad experience

It’s never pleasant to have a negative experience with your bank or creditor, but unless people complain about what happened to them or suggest ways they could have been treated better, then it is hard for organisations to improve.

If you’ve had a bad experience with your bank or any other creditor such as credit card company, gas or electric company in relation to your debt problems in the past six months and you would like to make a complaint then please visit to download a template letter.

If more people make complaints about the poor service they have received then the regulators of these industries will know more about the problems faced by people with experience of mental distress!

If you need financial information

Mind has launched a new financial section on the Mind website which offers financial information including information on affordable sources of credit such as credit unions, tips on how to budget and insurance. It can be found at

Case study: Compulsive spending

Paul Davidson has experienced depression and PTSD for most of his life, and for Paul financial difficulties have been part and parcel of living with undiagnosed mental health problems. Without the support of professional treatment, for many years excessive spending was the only outlet for his distress.

“A feeling of desperation is fundamental in getting people into debt. Some people self-harm, some people drink, but with me it’s a desperate need to spend.”

Paul would spend all of his income on things he didn’t need, often buying the same item again and again.

“I buy things for that feel good factor. But when I’ve bought things, there’s a massive down and a feeling of: “Oh god, what have I done?”

Meanwhile, he would struggle to pay for even basic necessities such as rent, utilities and food, and had his gas and electric cut off several times. After a personal tragedy, Paul ran up a phonebill of £1,350 in just three months, for which he still owes money eight years down the line.

“I spent every penny I had. I spent it at the pub, I spent it at bingo, I even relied on my bingo winnings to pay my debts.”

Paul’s compulsive spending would have continued but the turning point finally came when he started receiving counselling from Mind in Gateshead.

With the help of his counsellor, he came to understand that his excessive spending was linked to his feelings of trauma. He has since received psychotherapy for his problems and has gradually learned to control his spending.

“It has been a long but positive struggle since then, still lots of spending sprees, but due to the help I received, I am much more stable and in control of my finances.”

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