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MONEY ON YOUR MINDThe Money and MenTal healTh Policy insTiTuTe June 2016

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.

That’s why this survey, the first from the new Money and Mental Health Policy Institute, is so powerful and revealing. Thankfully as the stigma about mental health has diminished people have been willing to open up to us to reveal how money and mental health problems interact.

I want to give enormous thanks to all who bravely took part. We’ve always assumed they were a marriage made in hell and this is confirmation.

We already know that half of British adults with a debt problem also have a mental health problem. You can’t fix one without the other.

This report now helps us to understand why: it sheds light on the financial experiences of nearly five and a half thousand people with mental health problems. It is an unprecedented insight, and the findings are stark. People with mental health problems told us that, as well as having less income when they are unwell, they are spending more, finding it harder to manage their finances and in many cases even taking on new credit that they would otherwise have avoided.

Luckily attitudes in business and the financial services industry have improved over recent years. Although there is still a long way to go, there is now more support for people with mental health problems who are managing financial issues. Yet there’s never been any real focus on stopping this mess happening in the first place.

That’s the aim of the policy institute, to come up with solutions, and work with others to put them in place. Yet this isn’t about doing it in isolation – it’s about bringing consumers, mental health groups, trade bodies, firms, regulators and politicians together to make it all work.

So a message to those working in financial services, in retail, health and in policy; come with us. To fix this we need you. We don’t have time to worry about what’s taboo any more, let’s get the conversation started.

Martin Lewis Money and Mental Health Founder and Chair

FOREWORDMoney on youR Mind

moneyandmentalhealth.org

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•86%ofrespondentssaidtheirfinancialsituationhadmade their mental health problems worse.

• 72% of respondents said their mental health problemshadmadetheirfinancialsituationworse.

Falling behind with bills Morethanhalfofoursamplehadfallenbehindwithbills in the last year. When asked to explain the main reasons,ourrespondentsselected:

•Mentalhealthproblems:67%

•Difficultiesmanagingmoney:60%

•Livingonalowincome:55%

•Jobloss/dropinwagesorbenefits:36%

Work to improve the lives and finances of people with mental health problems needs to consider financial management and mental health as well as income replacement and employment.

Altered financial behaviour during periods of poor mental health Averyhighproportionreportedchangesintheirspendingpatternsandabilitytomakefinancialdecisionsduringperiodsofpoormentalhealth.Respondentssaidthatduringperiodsofpoormentalhealththeyhad:

•Spentmorethanusual:93%

•Foundithardertomakefinancialdecisions:92%

•Putoffpayingbills:74%

•Avoideddealingwithcreditors:71%

•Takenoutaloanthattheywouldn’totherwisehavetakenout:59%

Thisfindingdemonstratesthatrespondentsbelievetheirownfinancialbehaviourduringperiodsofpoormentalhealthcontributestopoorfinancialoutcomes.Work to help people with mental health problems needs to explore ways to help them avoid ‘financial self-harm’.

Mental capacity at the point of sale InlinewiththecriteriaoftheMentalCapacityAct2005,weaskedourrespondentstoconsiderhowtheirmentalhealthproblemshadaffectedtheirdecision-makinginapplicationsforcreditthattheyhadmadeduringthelast 12 months.

•24%saidtheywereunabletounderstandthetermsandconditions.

•38%saidtheywereunabletorememberwhattheyhadbeentoldabouttheloan.

•48%saidtheywereunabletoweigh-uptheadvantages and disadvantages of the loan.

FOREWORDMoney on youR Mind


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Executive summary

Moneyandmentalhealthareintricatelylinked.Mentalhealthproblemsmakeithardertomanageyourfinancesandlivinginfinancialstresscanharmyourmentalhealth.Thisreportsetsoutadetailedanalysisofhowandwhythishappens,basedontheexperienceofnearly5,500peoplewhohavelivedwith mental health problems.

•34%saidtheywereunabletocommunicatetheirdecision,askquestionsordiscusstheloanwith the organisation that they applied to.

Thesefindingsdemonstratethatmentalcapacityatthetimeofapplyingforcreditisasignificantissue,andonethatneedsfurtherexploration.

Mapping the journey from financial difficulty to mental health problems Financialdifficultiescanleaddirectlytomentaldistress.Manyofthoseinfinancialdifficultyreportanxiety,worry,anddepressiondirectlyattributedtotheirfinancialposition.Insomniaandsuicidalideationare also prevalent.

Therearealsoindirectcausesofmentaldistress. Weidentifyfour:

Demands on time or mental energy: Dealingwithfinancialdifficultiescanrequireagreat dealoftimeandeffort.Thereisincreasingevidencethatlivingwithfinancialdifficultiescarriesacognitiveloadthataffectspeople’scapacitytothinkaboutorprocessotherinformationsuchastheirmentalhealth orrecovery.

Creditor action: Whilemuchcreditorpracticehasimprovedandsomerespondentsrecountedpositiveexperiences,wherebadpracticeoccursitcanhaveaprofoundimpact.Perceivedexcessivecontactbycreditors,unaffordabledemands,andtherepossessionofhomeorpossessionscanallharmmentalhealth.

Social/Financial exclusion from activities and support network: Financialdifficultiesoftenleadpeopletobecomeexcludedfromactivities,socialgroups,orbehavioursthatareknowntosupportmentalhealthandwellbeing-includingtakingabreakorreducinghoursatwork.Exclusioncanbecausedbyfinancialdifficultiesorbypsychologicalbarriers,suchasfeelingsofshame.

Going without “essentials”: Goingwithoutessentialssuchasfoodorheatingcanbeharmfultobothphysicalandmentalhealth.Respondentswhosefinancialcircumstanceshadforcedthemtocutbackonessentialsoftenreportedfeeling worthless.

Relationship difficulties: Financialdifficultiescanhaveadramaticimpactoncouplerelationships.Thesubsequentimpactonmentalhealth of both relationship breakdown and stress in ongoingcouplerelationshipswasprevalentinourrespondents’stories.

Mapping the journey from mental health problems to financial difficulty Respondentsdescribed,alongsideunmanageabledebt,awidevarietyoffinancialdifficultiesincluding:

•Runningdowntheirlifesavings

•Beingdependentonothersforsubsistence

•Becomingfinanciallyexcluded

•Relationshipdifficulties

Mentalhealthproblemsweredescribedascontributingto relationship breakdown by some respondents, resultinginanincomeshockofsomekind.

Loss of or low income Weidentifiedtwopathwaysfrommentalhealthproblemsintodebtthatrelatetoincome:persistent lowincomeduetoun-orunder-employmentandincomeshocksasaresultofamentalhealthcrisis or relationship breakdown.

Physical health problems some respondents explained their mental health problemshadtriggered-orbeentriggeredby-physicalhealthconditionsordisabilities,leadingto lossorfurtherlossofincomeand/orhighercosts.

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Mental health treatments Respondentsnotedside-effectsoftreatmentsaffectingphysicalhealthandcognitivecapacity,andthusleadingtoemploymentlossorfinancialmismanagement.

Cognitive impairments Many respondents said their mental health problems hadimpairedtheircognitivefunctioning,makingitharderforthemtomanagetheirfinances.Thisincludedproblemswithbudgeting,paperwork,judgement,memory and timekeeping.

Psychological barriers Manyrespondentsdescribethemselvesasinastateofdenial,phobicabouttheirfinances,ordisengagingcompletelyfromcontactwithcreditorsortheir financialsituation.

Higher spending Wehaveidentifiedsevendifferentdriversforincreasedspending,sixofthempsychologicalorcognitive. Theseare:

• Manic spending duringahighorperiodofmania

• Nihilistic spendingwherethetransaction,orlifeitself,isconsideredmeaningless

• Comfort spending to boost low mood

• Social value spendingtobooststatusorself-worthby giving money or gifts to others

• Impulsive spendingwhererespondentscouldn’trecollectorattributepurposetothetransaction

• Addictive spendingtofeedanaddiction

in addition, some people reported they had spent more becauseofhighercosts,andanothergroupreportedrestrictingtheirexpenditure,beyondwhatwouldbeconsideredrational,asaresultofanxiety.

Shaping the work of Money and Mental Health Ourvisionisofaworldwherementalhealthproblemsdon’tleadtofinancialdifficulty,andwhereproblemswithmoneycanbemanagedwithoutlong-termimpactsonourmentalhealth.Wewillusethisevidencetohelpusdesignourprogrammeoffuturework,andbuildevidence-basedproposalsforpolicyinterventionsbygovernment,regulators,adviceagencies,healthservices,retailersandfinancialserviceproviders.

Financial Services Weurgethefinancialservicesindustrytobuildonrecentprogressbycontinuingtodevelopproducts,settings,andsystemstohelppeoplestayoutoffinancialdifficulties.

Retailers Wecallontheretailindustrytoexplorewaystosupportcustomerswithmentalhealthproblems,aspart of the wider movement on responsible retailing.

Health professionals Healthprofessionalsshouldbeawarewhendiagnosing mental health problems of the potential impactthoseconditionsmayhaveonaperson’sfinancialstatus.

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Thelinkbetweenmentalhealthproblemsandfinancialdifficultieshasbeenwidelyacknowledgedformanyyears,andiswelldocumentedinacademicliterature.Itisclearthatlivingwithamentalhealthproblemcanleadpeopleintofinancialdifficulty;itisequallyclearthatlivingunderfinancialstresscantriggerepisodesof poor mental health.

What we already know: 1in2Britishadultswithadebtproblemhasamentalhealth problem 1

1in4Britishadultswithamentalhealthproblemhasproblem debt 2

Debtproblemsincreasethechancesofpoormentalhealth–peoplewithdebtproblemsaretwiceaslikelytodevelopmajordepression3

The more debt a person has, the more likely they will have a mental health problem 4

Debtcanmakerecoveringfromamentalhealthproblem harder – people with depression and problem debtarefourtimesmorelikelytostillbedepressedwhencontacted18monthslater(comparedtothosewithdepressionbutnoproblemdebt)5

Mentalhealthproblemscanmake‘financialrecovery’harder –dueto:

•theirassociationwithsubsequentunemployment,reducedhours/salary,andbenefitreductions/delays

•hospitaladmissionsorside-effectsfrommedications

•peoplebecominganxiousorunwellwhencontactedbycreditors,orfindingitdifficulttocommunicatewithdebtcollectionordebtadvicestaff6

Arelationshipexistsbetweendebtandsuicide,poorphysicalhealth,fuelpovertyandalcoholanddrugdependence.7,8,9,10

TheMoneyandMentalHealthPolicyInstitutehasbeenfoundedonthestrengthofthisevidencetoconductresearchandpolicydevelopment,andsobreakthisdevastatinglinkbetweenfinancialdifficultiesandpoormentalhealth.Weconductedasurveyofmorethan5,000peoplewithlivedexperienceofmentalhealthproblemstohelpshapeourwork.Ourobjectiveinconductingthisresearchhasbeentodeepenoursharedunderstandingofthecomplexchainsofcausalitythatleadtothisstrongcorrelationbetweenfinancialdifficultiesandpoormentalhealth.

Thisreportisthefirstoftwoanalysingtheresultsofoursurvey.Asecondpublication,reportingourfindingsontheinteractionsbetweenconsumerswithmentalhealthproblemsandthefinancialservicessector,adviceagenciesandmentalhealthserviceswillbepublishedlaterthissummer.

1 JenkinsR,BhugraD,BebbingtonP,etal.Debt,incomeandmentaldisorderinthegeneralpopulation.PsychologicalMedicine2008;38:1485-1494.2 JenkinsR,BhugraD,BebbingtonP,etal.Mentaldisorderinpeoplewithdebtinthegeneralpopulation.JournalofPublicHealthMedicine2009;6:88-92.3SkapinakisP,WeichS,LewisG,etal.Socio-economicpositionandcommonmentaldisorders:LongitudinalstudyinthegeneralpopulationintheUK.BritishJournalofPsychiatry2006;189:109-17.4FitchC,HamiltonS,BassettP,etal.Therelationshipbetweenpersonaldebtandmentalhealth:Asystematicreview.MentalHealthReviewJournal2011;16,4:153-166.5FitchC,TrendC,ChaplinR.Lending,debtcollectionandmentalhealth:12stepsfortreatingpotentiallyvulnerablecustomersfairly.London.2015.6 ibid. 7 MeltzerH,BebbingtonP,BrughaTJ,etal.Personaldebtandsuicidalideation.PsychologicalMedicine2011;41:771–778.8 RichardsonT,ElliottP,RobertsR.Therelationshipbetweenpersonalunsecureddebtandmentalandphysicalhealth:asystematicreviewandmeta-analysis.ClinicalPsychologyReview2013;33:1148-1162.9ThomsonH,ThomasS,SellstromE,PetticrewM.Housingimprovementsforhealthandassociatedsocio-economicoutcomes.CochraneDatabaseofSystematicReviews2013.10 FitchC,HamiltonS,BassettP,etal.Therelationshipbetweenpersonaldebtandmentalhealth:Asystematicreview.MentalHealthReviewJournal2011;16,4:153-166.

Section One - The links between money and mental health


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Section Two - Our findings

Below,wereportonrespondents’answersto thequestions:

• Inyouropinion,hasyourfinancialsituationmadeyourmentalhealthproblem(s)worse?

• Inyouropinion,haveyourmentalhealthproblem(s)madeyourfinancialsituationworse?

Inaddition,weanalysedatotalof4,126freetextexplanationsfrom2,912respondentsgivingtheiraccountofwhythishadhappened.Itisimportanttonote that, in addition to identifying the pathways from poormentalhealthtofinancialdifficultyandthereverse,asubsetofrespondentsidentifiedexternaltriggersfortheonsetofboththeirfinancialandmentalhealthproblems.Theseincludedredundancy,physicalhealthproblems,incomeloss,benefitchanges,relationshipbreakdown and bereavement.

Wethengoontoanalysehowparticipants’mentalhealthproblemsaffecttheirfinancialbehaviours. Wereportonresponsestoquestionsonthe followingtopics:

•Howdomentalhealthproblemsaffectapplicationsforcredit,atthepointofsale?

•Howdoperiodsofpoormentalhealthaffectparticularfinancialbehaviours?

2.1 In your opinion, has your financial situation made your mental health problems worse? 86%ofrespondentssaidthattheirfinancialsituationhad made their mental health problems worse. 11 Responsesweresimilaracrossallincomegroupsexceptforthosewithahouseholdincomeof£1000or more per week, where only 67% agreed with this statement. nevertheless, still more than two thirds of thehighincomegroupbelievethatfinancialdifficultieshadcontributedtotheirmentalhealthproblems,demonstratingthatfinancialstressdoesnotonlyhaveanimpactonthoseinpoverty,butcanaffectpeopleregardlessofincome.12

By breaking responses down by mental health diagnosis, wecanseehowthestrengthofthiseffectvariesbetweendifferentmentalhealthproblems.13 Itappearsthatfinancialdifficultiesaremorelikelytohaveanimpactonthosewithparticularmentalhealthproblemssuchasbipolarandborderlinepersonalitydisorder,althoughitislikelythatsomeofthiseffectcanbeattributedtovariationsinincomebetweenthosewithdifferentconditions.

Thissectionsetsoutthefindingsfromsixofthequestionsinoursurveythatweredesignedtoelicitinformationfromrespondentsabouttheimpactoftheirmentalhealthontheirfinancialpositionandviceversa.Ourobjectivewastoestablishamoregranularunderstandingofhowthecausalpathwaysoperatefrom one problem to the other.


11Basedon2,329responses.12Hereandbelow,inparticularinouranalysisofthequalitativeresponses,weobservevariationsbetweentheresponsesofthosereportingdifferentmentalhealthconditions.Oursurveywasofanon-randomsampleanditisnotpossibletomakeanyclaimofstatisticalsignificanceinthesevariations.Wereportvariationsinthedatawhichwillbeusefultoguidemoredetailedandpreciseinquiriesandresearch.13Respondentswereabletochoosemorethanonediagnosis,butwerenotaskedtoprovideaprimarydiagnosis.Inouranalysishereandbelow,wereporttheresultsforallthosewhoreportedaparticulardiagnosis,regardlessofwhethertheyhadreportedanyotherconditions.

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Demands on time or mental energy

Creditor action

Social/financial exclusion from activities and support network

Going without ‘essentials’

Relationship difficulties

IMPACT ON MENTAL HEALTH

Guilt/shameAnxiety

Low self-esteemAnger

FrustrationFear

Low moodSelf-harm

Suicidal ideationInsomnia

Panic attacksLethargy/apathy

Substance misuse

Yes No Couldn't Say

Dementia(includingAlzheimer's) 84% 6% 10%

PsychosisorSchizophrenia 85% 4% 11%

Alcoholordrugdependence 86% 5% 10%

Seasonalaffectivedisorder 86% 5% 9%

Post-nataldepression 86% 4% 10%

adhd or add 87% 4% 9%

depression 88% 4% 8%

anxiety disorder 88% 4% 8%

Obsessivecompulsivedisorder 89% 5% 7%

Panicattacks 89% 3% 8%

Phobia(any) 89% 3% 8%

eating disorder 90% 2% 8%

Post-traumaticstressdisorder(PTSD) 90% 2% 7%

Bipolar disorder 91% 4% 5%

Personality disorder 91% 2% 7%

Thisprovidesclearevidenceofthenegativeimpactthatfinancialdifficultiescanhaveonmentalhealth.Inallcases,remarkablyfewrespondentsdeniedthattheirfinancialsituationhadaffectedtheirmentalhealth.Indeed,only5%ofrespondentswereconfidentthattheirfinancialsituationhadnotmadetheirmentalhealthproblemsworse;theremaining9%ofrespondentswereunsure.

We then asked respondents to give an explanation with afree-textbox;1,588respondentsprovidedadetailedanswer. 14Ouranalysisoftheirresponsesenablesustomapindetailforthefirsttimethejourneythatpeoplewith mental health problems believe they have taken fromfinancialstraintomentalhealthsymptoms.

14Manyrespondentsprovidedexplanationsthatmappedtheimpactoftheirfinancesontheirmentalhealth,butalsoprovidedexplanationsmappingthereverse:theimpactoftheirmentalhealthontheirfinances.Thisisunsurprising,giventhecomplexcausalityinvolvedandthefactthatrespondentswerenotawarethatthesubsequentquestionwouldprovidethemwithanopportunitytodescribetheimpactoftheirmentalhealthproblemontheirfinances.Foreaseofcomprehension,inthissectionofthereport,weanalyseonlythoseresponsesthatwecodedasdescribingtheimpactoffinancialsituationonmentalhealth;responsesthatdescribedthereverseareanalysedbelowinSection2.2regardlessofwheretheyweresubmittedinthesurvey.

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Demands on time or mental energy

Creditor action

Social/financial exclusion from activities and support network

Going without ‘essentials’


IMPACT ON MENTAL HEALTH

Guilt/shameAnxiety

Low self-esteemAnger

FrustrationFear

Low moodSelf-harm

Suicidal ideationInsomnia

Panic attacksLethargy/apathy

Substance misuse

Routesfromfinancialdifficultytomentalhealthproblems

Financial difficulties Thebluearrowrepresentsthedirecteffectthatfinancialdifficultiescanhaveonmoodandmentalhealth.Thisisthemostcommonpathwayandisarguablytheeasiest tounderstand.Weidentifiedawiderangeofemotionalstates and symptoms of poor mental health in respondents’contributionsasshowninthediagramabove. dominant among these were reports of anxiety,worryorstress(citedby619respondents),andoflowmood,depressionorlethargy(citedby498respondents)butreportsofinsomniaandsuicidalideationwerealsocommon(citedby133and155respondentsrespectively).

“My financial situation causes stress every day it’s like a black cloud hanging over me every day. It never goes away... I never thought I would be unwell this long. I don’t know when or how I will ever get on top of it.”

Demands on time or mental energy Dealingwithfinancialdifficultiescanrequireagreatdealoftimeandeffort.Thereisincreasingevidencethatlivingwithfinancialdifficultycarriesacognitiveloadthataffectspeople’scapacitytothinkaboutorprocessother information. 15Theanxietydescribedbymanyofourrespondentsalsoappearstocarryacognitiveload,crowdingouttheircapacitytodealwithotherconcernsortakeontheadministrativeburdenofdealingwiththeirfinancialaffairs.176respondentssaidmoneyworrieswere“constantly”or“always”ontheirmind.

“[I’m] constantly worrying about making payments. The embarrassment. Not being able to provide for my family. Constantly stressed.”

Creditor action Overthelasttenyears,ahugeamountofworkandefforthasgoneintoimprovingthepracticeofcreditorsin dealing with those with mental health problems. This wasreflectedintheresponsesofsomeofoursurveyparticipants,whoreportedcompassion,forbearanceorunderstandingfromtheircreditorswhentheyexplainedtheirmentalhealthproblems;thosewhohadthesekindofpositiveexperienceswithcreditorsoftenreportedapositiveimpactontheirmentalstateasaresult.

“The branch staff made me feel confident to tell them about my depression and health condition. I was allocated a personal advisor who ‘held my hand’ through every step. His patience was endless and most importantly for me I finished every visit, phone call and email conversation feeling in control and with my dignity in tact.”

Nevertheless,theactionsofcreditorscanoftenbeanimportantelementofthecausalchainbetweenfinancialdifficultiesandmentalhealthproblems.Respondentsdescribedfourcommonwaysinwhichcreditorbehaviourcontributedtonegativementalhealthoutcomes.

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15Mani,A.,Mullainathan,S.,Shafir,E.,&Zhao,J.(2013).Povertyimpedescognitivefunction.Science,341:976-980.

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Contact: Manyrespondentsperceivedcontactbycreditorstobeexcessive,andthattheregularityandtoneofthiscontact(byphone,letter,orfacetoface)wascontributingtoadeteriorationintheirmentalhealth. Intheextreme,excessivecontact,inparticular whenalargenumberofcreditorsarecontacting anindividualsimultaneously,canleadtofeelings ofanxiety,paranoiaandexhaustion.

“[I received] relentless attention from every supplier and creditor that had to be juggled, batted back or ignored. With every week and month the relentless managing and dealing with financial issues compounded my already weak state.”

Repossession: Ultimately,someofthosewhogetintofinancialdifficultyenduplosingtheirhomeoranitemonwhichcreditwassecured,orhavingpossessionstakenfromthembybailiffstopaydebts.Respondentswhohadexperiencedrepossessionofgoodsboughtoncredit,bailiffvisitsand,inparticular,therepossessionoforevictionfromahome,oftenreportedfeelingsofhumiliation,guiltorshame,sometimesaccompanied by anger

.“Being made bankrupt and having my home repossessed had a terrible effect on my mental health and I don’t think I will ever feel secure again.”

Unreasonable treatment: Insomecases,respondentsperceivedthebehaviourofcreditorstobeperverse,unreasonable,orirrational.Examplesincludepaymentplansthatwereperceivedtobesounaffordableastobeludicrous,feesandchargesthatwerelargerthantheoriginaldebt,ordifferentinformationgivenbydifferentemployees ofthesamecompany.

Itisnotpossibleinthisresearchtomakeajudgementaboutthecircumstancesandappropriatenessofcreditors’reportedbehaviour;itisclear,however,thatwhenadebtorperceives,rightlyorwrongly,thatacreditorisirrationalorperverse,thishasanimpactonthe debtor’smentalstate.

Respondents reported feelings of hopelessness or impotence,andinsomecases,angerorfrustration.

“Bailiffs turning up with no understanding of my conditions and being threatening/intimidating, getting taken to court over TV licence when I thought the woman who came told me it would not be a problem.”

Predatory lending/retailing: Manyrespondentsblamedfinancialinstitutionsand/orretailersforsomeoralloftheirfinancialdifficulties. Asabove,thesurveyisnotabletotelluswhetherinrealityparticularlendingpracticesorretailingstrategiesareexploitingvulnerableindividuals,butourrespondents’beliefthattheyhavebeenpreyeduponappears to add to their sense of mental distress, often generatingemotionsofanger,frustrationandguilt.

“I didn’t understand a lot of the conditions and repayments when taking out a loan. I left not even remembering most of the meeting in the bank. I prob[ably] would have done anything they said and signed anything to get out of there.”

Social/Financial exclusions from activities and support network Asubstantialgroupofrespondentsdescribedtheway inwhichtheirfinancialdifficultieshadledthemtobecomeexcludedfromactivities,socialgroups,orbehavioursthatareknowntosupportmentalhealthandwellbeing.Exclusioncanbecausedbyfinancialdifficultiesthemselves,suchasnothavingenoughmoneytotakepartinsocialactivities,butcanalsobecausedbypsychologicalbarriers,suchasfeelingsofshame.

“My clothes are tatty and threadbare, covered in a shabby coat and worn with even shabbier shoes. People judge you at work by your appearance and I know I’m being judged. My appearance generally adds to my feelings of being low status and low self worth.”


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Manyrespondentsreportedthattheirfinancialdifficultieshaddamagedfriendandfamilyrelationshipsandthus,informalsupportnetworks.Respondentswhowereworkingoftendescribedthemselvesasunabletotakeabreak,reducetheirhours,orhaveaholidaybecauseoftheirfinancialsituation;thisrequirementtoworkatanundesirablepacewascontributingtotheirstressandanxiety.Afurthergroupofrespondentsdescribedinadequatehousingasasignificantsourceof mental distress.

“I felt I had to make excuses for not attending family social occasions and meals out because of embarrassment over having no money. This leads to further isolation and a sense of worthlessness.”

Going without “essentials” Goingwithoutessentialssuchasfoodorheatingcanbeharmfultobothphysicalandmentalhealth.Respondentswhosefinancialcircumstanceshadforcedthemtocutbackonessentialsoftenreportedfeelingworthless;someofthosewhohadcutbackonfoodhadfoundthisexacerbatedorprovokedaneatingdisorder.Wherechildrenwereinthehouse,respondentsoftenreportedfeelingsofguiltabout theirchildrengoingwithout.

“I often skip meals or eat breakfast cereals to save money and rarely put the heating on which causes more worry because I have anaemia and should be looking after myself better.”

“I am currently having one of my bad days. This stems from having a nil balance in my account, limited food in my house, no toilet roll, 2 school trips to pay for and my daughter needs new school trousers.”

Relationship difficulties Financialdifficultiescanhaveadramaticimpactonallrelationships,butcouplerelationshipsinparticular.ResearchbyRelatehasshownthatmorethanhalfofcouplesconsidermoneyworriestobeamongthetopthree strains on their relationship, 16 and that those most adverselyaffectedbythepost-2008recessionwereeight times more likely to end their relationship than those whohadnotbeenaffected. 17Thesubsequentimpacton mental health of both relationship breakdown and stressinongoingcouplerelationshipshasbeenwelldocumented. 18Itisalsopossibletoisolatethischainofcausalityinoursurveyresponses:94notedtheimpactoftheirfinancialdifficultiesontheirrelationship,includingmanywhohadhiddentheirfinancialcircumstancesfromtheirpartner,withadverseconsequencesfortheirownwellbeing.Below,insection2.2wealsoexaminerespondents’accountsoftheimpactoftheirmentalhealth problems on relationships.

“I’m so ashamed of myself I entered an IVA [Individual Voluntary Agreement]. My partner nearly left me and even now doesn’t know the full truth. I felt useless and I am someone whom has been bankrupt because of debt.”

16UndyH,BloomfieldB,JoplingK,MarcusL,SaddingtonP,ShollP.Theway wearenow:ThestateoftheUK’srelationships.Relate.2015.17Kneale,MarjoribanksDandSherwoodC.Relationships,RecessionandRecovery:Theroleofrelationshipsingeneratingsocialrecovery.Relate.2014.18Walker,J.,Barrett,H.,Wilson,G.&Chang,Y-S.(2010)RelationshipsMatter:UnderstandingtheNeedsofAdults(ParticularlyParents)RegardingRelationshipSupport.London:DepartmentforChildren,SchoolsandFamilies.


2.2 In your opinion, have your mental health problem(s) made your financial situation worse? 72%ofourrespondentssaidthattheirmentalhealthproblemshavemadetheirfinancialsituationworse,withonly15%denyinganyfinancialimpact. 19 as before, thereisasubstantialdifferencebetweentheresponsesofthosewiththehighestandlowestincomes.83%ofthoseonthelowestincomesanswered‘Yes’tothisquestion.Thosewiththehighestincomesweretheleastlikelytoreportafinancialimpactfromtheirmentalhealth problems. nevertheless, more than two thirds of thisgroup,withincomeofmorethan£1,000aweek,

believedtheirfinancialsituationhadbeenadverselyaffected,demonstratingthatmentalhealthproblemscanaffectfinancesthroughavarietyofmechanisms,notsimplythroughlossofearnings.

Asabove,itispossibletobreakthisresultdownbydiagnosis,toseewhichconditionsaremostlikelytoaffectaperson’sfinances.Thespreadbetweenconditionsislargerinthissetofresponsesthaninthepreviousone,suggestingthatthereismorevariationinthewaythatmentalhealthproblemsaffectfinancesthanthereverse.Theconditionsofmostconcernarethesame two as before, bipolar and personality disorder.

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Yes No Couldn't Say

Post-nataldepression 73% 14% 14%

depression 75% 13% 13%

eating disorder 75% 10% 15%

anxiety disorder 75% 11% 13%

Dementia(includingAlzheimer's) 76% 11% 13%

Panicattacks 78% 10% 13%

Phobia(any) 79% 10% 11%

Seasonalaffectivedisorder 80% 9% 10%

Obsessivecompulsivedisorder 80% 10% 10%

adhd or add 81% 8% 12%

Post-traumaticstressdisorder(PTSD) 81% 8% 11%

Alcoholordrugdependence 82% 6% 12%

PsychosisorSchizophrenia 84% 7% 9%

Personality disorder 85% 5% 10%

Bipolar disorder 88% 5% 7%

19Thisquestionhadasubstantiallyhigherresponseratethantheprecedingquestion,however,with4,068responses,1,739higherthanthepreviousquestion.Thereforeatotalof2,929peoplesaidtheirmentalhealthhadaffectedtheirfinances;1,997peoplesaidtheirfinanceshadaffectedtheirmentalhealth.

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Loss of or low income

Higher spending

Poor financial management

IMPACT ON FINANCES

Debt

Loss of savings

Insecure or poor quality housing

Bankruptcy

Poor credit rating

Going without

Legal issues

Loss of possessions


Physical health problems

Mental health treatments

Cognitive impairments

Psychological barriers to action


Routesfrommentalhealthproblemstofinancialdifficulty

We then asked respondents to give an explanation with afree-textbox;2,538respondentsprovidedadetailedanswer.Ouranalysisoftheirresponsesenablesustomapindetailrespondents’journeysfrommentalhealthsymptomstofinancialdifficulties;itwillbeinstantlyobservablethatthemapismorecomplexthantheonemappingthejourneyintheoppositedirection.

Awidevarietyoffinancialoutcomesareoutlinedinthefinalbox,recognisingthatthesymptomsoffinancialdistressdescribedbyourrespondentsaremorediversethanproblemdebt.Traditionally,researchhaslookedmainlyatthecorrelationbetweendebtandmentalhealthproblems;oursurveyresponsesdemonstratethatinfuture,researchmustlookatawiderrangeofadversefinancialoutcomes.Respondentsdescribed,alongsideunmanageabledebt,financialdifficultiesincluding:

•Runningdowntheirlifesavings

•Livingbelowthepovertyline,oftenasaresultoflosing or giving away money

•Beingforcedtoliveindangerousorinadequatehousing

•Beingdependentonothersforsubsistence

• Livingwithfeworinadequatepossessions

•Becomingfinanciallyexcluded,unableorunwilling tousemainstreamfinancialservices

Relationship difficulties Relationshipdifficultieswereidentifiedbyrespondentsas an important pathway from mental health problems tofinancialdifficulty.Mentalhealthproblemsweredescribedascontributingtorelationshipbreakdownbysomerespondents;thisoftenresultedinanincomeshockofsomekindtooneorbothparties.

“I did not always make rational decisions, and got confused over what I had agreed to. The worry of it all makes it worse. My partner left me because of my mental health problems and that means I have half the income now to live on.”

Afurthersetofrespondentsidentifiedrelationshipdifficultiesasanexternaltriggerforeithertheirfinancialdifficulties,mentalhealthproblems,orboth.

“I first started getting into debt at university after a breakup of a relationship and I would spend to make myself happy.”

Loss of or low income Weidentifiedtwodistinct,butlinked,pathwaysfrommentalhealthproblemsintodebtthatrelatetoincomeandearningcapacity.Onegroupofrespondentsidentifiedthattheirfinanceshadbeenadverselyaffectedbypersistentlowincomeduetolivingonbenefits,beingunabletowork,orbeingunabletoworkfulltime.Forthemajorityofthisgroupitwastheirmentalhealthproblemthathadmadeitdifficultorimpossibletowork,thoughforasubset,aphysicalhealthconditionordisabilitywastheprimaryreasonfortheirlackofemployment.

“I struggle to hold down long term, stable employment. Bouts of unemployment put a massive strain on my finances.”

Afurthergroupofrespondentsidentifiedanincomeshock-usuallylossofearningsasaresultofamentalhealthcrisis,butsometimesasaresultofarelationshipbreakdown-astheprimarylinkinthecausalchainbetweenmentalhealthproblemsandfinancialdifficulties.

Itwasclearthatforsome,anincomeshockevolvedintopersistentlowincome,butevenforthosewhofoundawaytorestoretheirincome,theperiodofearninglosswasrepeatedlydescribedasasubstantialcontributingfactortofinancialdifficulty.

“Have suffered a 1/3 drop in wages - have tried to carry on as normal but that isn’t possible... I am now on sick leave with unknown prospects as to whether a return to work is possible.”

Physical health problems some respondents explained that their mental health problemshadtriggered-orbeentriggeredby-physicalhealthconditionsordisabilities.Thiscanbeanimportantpathwaytowardsfinancialdifficulty,potentiallyleadingtolossorfurtherlossofincomeand/orhighercosts.

“I suffered a number of strokes which affected my brain function. I was bored and depressed being at home as I could not go to work as I was physically and mentally unable to do so. The guilt of my illness made me feel worthless, so I started buying gifts for my children by way of compensation as they were having to do so much for me.”

Mental health treatments Treatmentsforbothphysicalandmentalhealthproblemswerealsoidentifiedbyrespondentsasanimportantlinkinthechain.Inparticular,respondentsnoted:

•Side-effectsoftreatmentsaffectingphysicalhealth,includingweightgain,andsotohighercostsoremployment loss

•Side-effectsoftreatmentsaffectingcognitivecapacity,andleadingtoemploymentlossand/orimpairingfinancialmanagementandjudgement

“I think that prescribed medication for a chronic pain problem causes a “foggy” memory, I now make lists and notes for myself so that I do not forget.”

16


Manyrespondentscomplainedofdelaysinsecuringtreatment.Forsomethishadafinancialimpactbyreducingtheiremployability.Forothers,whochosetopayforprivatetreatment,ithadafinancialimpactbyincreasingtheiroutgoings.

“I start sessions to formally diagnose my condition on the 23rd of this month. I have to pay for this privately to obtain this diagnosis as there is no NHS funding.”

“I’m also in private counselling as the NHS have abandoned me so I’m paying £35 a week for this. I’m really worried about money and am almost constantly anxious about this.”

Cognitive impairments Morethan900respondentsreportedthattheirmentalhealthproblemshadimpairedtheircognitivefunctioning,thusmakingitharderforthemtomanagetheirfinances.Weidentifiedfoursub-themeshighlightedbyrespondents,aswellasasubstantialnumberwhoidentifiedamoregeneralinabilitytothinkclearly,whichweclassedasgeneralcognitiveimpairment.Thesub-themesweidentifiedare:

Budgeting and numeracy: Respondentsnotedthatduringperiodsofpoormentalhealththeirabilitytocomprehendnumbers,constructoradheretoabudgetwasimpaired.

“Worrying about the amount of money coming in vs what is needed to pay money owed, household bills, feed and clothe three children and ourselves exacerbated my anxiety levels making it impossible for me to think rationally or logically about budgeting. My mind became almost paralyzed and I was unable to make even simple decisions e.g to have cereal or toast at breakfast.”

Form-filling and paperwork: Agroupofrespondentsdescribedthemselvesasunabletodealwithorunderstandthevariousbureaucraticrequirementsofday-to-dayfinancialmanagement,benefitapplications,orapplications for debt relief.

“I find it hard to concentrate on forms and evaluate explanations. Many forms seem daunting and are not often asking similar questions… not understanding the right information makes it a problem dealing with finance basically.”

Judgement: Thelargestgroupofrespondentsdescribedtheirmentalhealthproblemsashavingsubstantiallyaffectedtheirabilitytomakesensible,rationalorbalanceddecisions.Mostoftheserespondentsdetailedfinanciallydamagingactionstheytookwhileunwellwhichtheydescribedwithwordssuchas“reckless”,“incomprehensible”,“stupid”or“idiotic”.

“I get ideas in my head and feel as though they are the best ideas ever, I think that by taking another loan to pay existing loans will help when actually it makes things worse. I overthink and blow things out of proportion all the time making my judgement hazed.”

Memory and timekeeping: Manyrespondentsdescribedproblemswithforgetfulness,inparticularwithregardstoappointments,purchases,payingbillsandmakingfinancialdecisions.Respondentsexplainedthatthiscognitivelosshad ledtofinancialdifficultybyincurringfees,charges andpenalties,includingbenefitsanctions.

“Anxiety affects my ability to deal with often quite simple situations. I forget passwords and then have too much anxiety to contact organisations to sort the problem out.”

17



Psychological barriers Thecognitiveimpairmentssetoutaboveoftenleadtofinancialmismanagementorpassivity,andthustofinancialdistress.However,weidentifiedanimportantseparatepathwaytofinancialpassivitywhichappearstobedrivenbyasetofpsychologicalfactors,distinctfromthecognitiveimpairmentsdetailedabove.Wedescribetheseas‘psychologicalbarrierstoaction’:responseswheresurveyparticipantsdescribedthemselvesasinastateofdenial,phobicabouttheirfinances,ordisengagingcompletelyfromcontactwithcreditorsortheirfinancialsituation.Thisincludesrefusalto open the post, answer the telephone or the door, or checkbankstatements.

Inevitablythereissubstantialoverlapbetweenthisandthecognitiveimpairmentssetoutabove,inparticulartheinabilitytoprocessnumbersorpaperwork.Withoutin-depthdiscussionswithrespondents,itisoftendifficulttotellwhetheranindividualispreventedfromdealingwiththeirfinancesbycognitiveincapacityorpsychologicalimpediment,andgiventhattheoutcomeisthesameitmaynotalwaysbenecessarytoknow.Weinterpretedmanyresponsesasfittingwithinbothcategories,butbelieveitisimportanttoidentifythatbothpathwaysexist,andshouldbeconsideredinseekingtounderstandfinancialpassivity.

“Being in debt has meant I can continue to indulge my pattern of avoidance. I don’t want to avoid reality, but it’s too stressful to think about the thousands I’m actually in debt.”

Higher spending Below,wereporttheoverallfindingsfromourquantitativeanalysisthatshowsthevastmajorityofrespondentshavespentmoreduringaperiodofpoormentalhealth.Ouranalysisofthefreetextresponsesbysurveyparticipantsallowsustobreakdownthepsychologicalandothercausesofthisincreasedspending.Wehaveidentifiedsevendifferentdrivers forincreasedspending.

Manic spending: Respondentsdescribedspendingmoneyduringperiodsofmania,orduringa“high”.Thisisusuallya period of high emotion and mood, with loss of

judgementandinhibition.Thispatternpredominatesamong those with a bipolar diagnosis.

“Whilst in a manic phase, I have obtained credit cards and bought holidays, cars and general shopping.”

Nihilistic spending: Wehavedescribedasnihilisticspendingthatwhichrespondentsdescribedasdrivenbyabeliefthateitherthetransactionortheworlditselfisofnoconsequence.Somerespondentsdescribedspendinginthiswaybecauseofabeliefthattheworld,theirlife,ormoney,wassoontocometoanend.Thispatternappearstobeparticularlycommonamongstrespondentswithdepression or PTsd.

“The iller I got the more I spent. Eventually I was constantly considering suicide and on this basis I spent more, as I wasn’t going to be here.”

Comfort spending: Thiswasthemostcommonlyidentifiedpatternofspendingamongourrespondents.Peopledescribedthemselves spending money to improve their mood, make themselves feel better, or give themselves a treat.Thispatternappearstobecommonacrossallconditions;forthosewithbipolarthisformofspendingwasdescribedasoccurringduringthedepressivephaseofthecondition.

“I comfort shop. When I feel down, depressed or low I shop to cheer myself up. Buying things gives me a high, cheering me up, but is very short lived hence a lot of debt.”

Social value spending: Asubstantialnumberofrespondentsspentmoneyonothers,orgaveitaway,duringperiodsofpoormentalhealth,inordertoboosttheirself-esteem,restoreasenseofpurposeorsocialvalueintheirlives,makeothershappy,orassuagefeelingsofguiltforinadequacyininterpersonalrelationships(inparticularinadequacyasaparent).Thispatterniscloselyassociatedwithcomfortspending,asitappearsalsotobeanattempttoboostlowmood,butthroughimpactsonothersrather than the self.

18


“Felt a better person when buying stuff, lots of it for family and friends. I loved being generous as felt it made people like me.”

Impulsive spending: Manyrespondentsdescribedtheirspendingdecisionsasthoughtless,recklessorimpulsive.Thiswasparticularlyprevalentamongthosewhodescribedthemselvesashavinglostjudgementduringtheirperiodof poor mental health. unlike the themes above, this kindofspendingseemstohavenopsychologicalpurposeattributedtoitbyrespondents:theyareoftenunabletoexplainit.

“When I take out a loan I spend it all within a month, then when I realise what I have done it just makes me more depressed.”

“Can’t really explain it but my mental health makes me make purchases in impulse and make instant decisions without thinking.”

Addictive spending: Adistinctsubsetofrespondentsattributedtheirincreasedspendingtoanaddiction.Thisincludesgamblingaddictionsandaddictiontosubstancessuchasalcohol,cigarettesandotherdrugs,whichareoftenexpensive.Somerespondentsdescribedthemselvesasaddictedto shopping.

“I am addicted to ringing psychics on premium rate phone lines and as a consequence have run up huge phone bills and incurred large amounts of debt.”

Increased costs: Thefinalcausegivenbyrespondentsforadditionalspendingwasincreasedcostsduetotheirmentalhealthproblems.Thisincludedhigherfuelbillsduetobeingathomeandthecostsoftreatmentsuchastravelexpensesandprescriptionfees.However,just47respondentsattributedtheirincreasedspendingtothesehealth-relatedcosts.

“I have to get 3 prescriptions a month for my bipolar which is expensive when you’re on a low income.”

Asmallersubsetofrespondentsidentifieddecreasedspendingduringperiodsofpoormentalhealth:restrictingtheirexpenditurebeyondwhatwouldbeconsideredrationalasaresultofanxiety.

“[I] live in fear of running out of money in my later years (currently in my 50’s). On a salary of around £15k tops, I have saved many thousands of pounds. This impacts on my daily life as I feel I cannot do the things that “normal” people do. Such as stopping for a coffee when shopping, buying full price groceries at the supermarket, replacing things when they are broken etc. I am exhausted from scrimping and saving.”

2.3 In the last 12 months, what have been the main reasons why you have been unable to pay bills when they are due? Itisclearfromtheanalysisabovethattherearemanycomplexreasonswhypeoplewithmentalhealthproblemsgetintofinancialdifficulty.Thishypothesisisreinforcedbytheresponsesgivenwhenweaskedrespondents who had got behind with bills in the last 12 months to explain why they believed this had happened. Respondents were permitted to give more than one answer.

2,261peoplerespondedtothequestion:theiranswersareshownbelow.Whilelivingonalowincomeisclearlyanimportantfactor,oursurveyshowsmentalhealthproblemsanddifficultiesmanagingmoneytobethemostcommonlyreportedreasonsforgettingbehindwith bills.

19

•Mentalhealthproblems-67%

•Difficultiesmanagingmoney-60%

•Livingonalowincome-55%

•Jobloss/dropinwagesorbenefits-36%

•Physicalillnessordisability-21%

•Delaysinpaymentofwagesorbenefits-12%

•Changeincircumstances-11%

• other 20-9%

•Dropinincomeduetorelationshipbreakdown-9%

•Noneofthese-4%

Itisclearfromthisfindingthatworktoimprovethelivesandfinancesofpeoplewithmentalhealthproblemsneedstoconsidersupportingfinancialmanagementandmentalhealthaswellasincomereplacement and employment.

2.4 Financial behaviours during episodes of poor mental health Todevelopabetterunderstandingofhowmentalhealthproblemscanleadtogettingbehindwithbills,weaskedpeopleaboutpatternsintheirfinancialbehaviourduringperiodsofpoormentalhealth.

Ourevidenceshowsthatpeoplesystematicallyspendmorethantheycanaffordandstrugglewiththeprocessofmanagingmoney.

•93%havespentmorethanusual

•92%havefoundithardertomakefinancialdecisions

•74%haveputoffpayingbills

•71%haveavoideddealingwithcreditors

•59%havetakenoutaloanthattheywouldn’totherwisehavetakenout

Theseresultspaintaclearpicture.Almostallofourrespondentstoldusthattheirmentalhealthproblemshaveimpairedtheirfinancialdecisionmakinginonewayoranother-fewerthan3%ofrespondentssaidtheyhadnotalteredtheirfinancialbehaviourinanyofthewaysmentionedduringaperiodofpoormentalhealth.

Wewereabletocomparetheincidenceofthesefivefinancialbehavioursbyrespondentswithdifferentdiagnoses.Incidencewashighacrossallconditionsandacrosseachbehaviour.However,fourconditionsconsistentlyappearedatthetopofthetable,withthehighestreportedincidenceofchangedfinancialbehaviour:

•Alcoholordrugdependence

• Bipolar

• Personality disorder

• adhd or add.

Twoconditionswereconsistentlyatthebottomofthetable,withlower,butstillsignificant,incidenceofchangedfinancialbehaviour:anxietydisorderanddepression.

Thesefindingsdemonstratethatrespondentsbelievetheirownfinancialbehaviourduringperiodsofpoormentalhealthcontributestopoorfinancialoutcomes.Work to help people with mental health problems needs toexplorewaystohelpthemavoidfinancialself-harm.

20


20200peopleresponded“other”andspecifiedreasonswhytheywereunabletopay their bills on time.

21

279%

32% 31%

71%

22%

7%

49%

26%

22%

73%

19%

8%

54%

18%

29%

Taken out a loan I wouldn't otherwise have taken out

Spent more than I usually do

Put off paying bills Avoided dealing with creditors

Found it harder to make financial decisions

Always / Often Rarely / Sometimes Never

279%

32% 31%

71%

22%

7%

49%

26%

22%

73%

19%

8%

54%

18%

29%






279%

32% 31%

71%

22%

7%

49%

26%

22%

73%

19%

8%

54%

18%

29%







279%

32% 31%

71%

22%

7%

49%

26%

22%

73%

19%

8%

54%

18%

29%






279%

32% 31%

71%

22%

7%

49%

26%

22%

73%

19%

8%

54%

18%

29%






279%

32% 31%

71%

22%

7%

49%

26%

22%

73%

19%

8%

54%

18%

29%






279%

32% 31%

71%

22%

7%

49%

26%

22%

73%

19%

8%

54%

18%

29%






279%

32% 31%

71%

22%

7%

49%

26%

22%

73%

19%

8%

54%

18%

29%






279%

32% 31%

71%

22%

7%

49%

26%

22%

73%

19%

8%

54%

18%

29%






279%

32% 31%

71%

22%

7%

49%

26%

22%

73%

19%

8%

54%

18%

29%






2.5 Mental capacity at point of sale Assetoutabove,duringaperiodofpoormentalhealth,59%ofourrespondentshavetakenoutaloanthattheybelievetheywouldnototherwisehavetakenout.indeed, 10% said that they always do so when they are unwell,andafurther17%saidthattheydosooften.Whilenewcreditappearstobesignificantlyrarerthanhigherspending,eachdecisiontotakeout“aloan”islikelytoinvolvelargerfinancialconsequencesthananindividualspendingdecision,andthereforethepotentialfordetrimentifpeopletakeoutinappropriateloansismuchhigher.

Mentalcapacityisaperson’sabilitytomakeaninformeddecisionataspecificpointintime.LegislationonmentalcapacitydiffersslightlyacrossUKcountries.InScotland,theAdultswithIncapacity(Scotland)Act2000providesaframeworkforsafeguardingthewelfareandmanagingthefinancesofadultswholackcapacityduetomentaldisorderorinabilitytocommunicate.InNorthernIreland,theequivalentlegislationistheMentalCapacityAct(NorthernIreland)2016whichgainedRoyalAssenton9May.

InEnglandandWales,therelevantstatuteistheMentalCapacityAct2005.Thisdeemsapersonunabletomakeaspecificdecisioniftheyarecannot,atthe time,satisfyallfourofthefollowingcriteria:

•Abletounderstandtheinformationrelevantto thedecision

• able to retain that information

•Abletouseorweighupthatinformationaspart oftheprocessofmakingthedecision

•Abletocommunicatetheirdecision(bytalking,usingsignlanguage,orthroughanyothermeans)

WeusedthesecriteriafromtheMentalCapacityAct,andaskedourrespondentstoconsiderhowtheirmentalhealthhadaffectedtheirdecision-makinginapplicationsforcreditthattheyhadmadeinthelast12months.Theirresponsesaresetoutinthechartsonoppositepage.

Highnumbersrespondedthatthey“couldn’tsay”whethertheyhadmentalcapacityaccordingtothesecriteria.Thismaybebecausethesearecomplexquestions,orbecauserespondentscouldnotrecollecttheperiodinquestioninsufficientdetail.Itwouldbewrongtoassumethatnotbeingabletosayifyouhadcapacitymeansyoudidnot.Nevertheless,itisworthobserving that only a minority of respondents were confidenttheysatisfiedallofthesecapacitycriteriaatpoint of sale.

•Only31%satisfiedallfourofthecriteriaatthemomentwhentheyappliedforcredit

•54%wereunabletosatisfyatleastoneofthecriteria

•16%wereunabletosatisfyanyofthefourcriteria

16% of respondents applied for credit in the last twelve months despite being:

• unable to understand the terms and conditions of their loan

• AND unable to remember details about their loan

• AND unable to weigh up the advantages and disadvantages of the loan

• AND unable to communicate their decision, ask questions, or discuss the loan with the provider they had applied to.

Lawandregulatoryguidanceexpectlenderstopresumethatallborrowershavethementalcapacitytomakeaninformeddecisionaboutaloan(topreventdiscriminationagainstpeoplewithcertainconditions),unlessthelenderalsoknowsorreasonablysuspectsthatamentalcapacitylimitationexists.Thereforethefactthataborrowerbelievestheydidnothavementalcapacityatpointofsaleisnot,necessarily,anindicationofanywrongfulpracticebythelender.

22

23


24%

24%

52%

18%

44% 38%

21%

45%

34%

20%

42%37%

16%

36%

47%

Due to my mental health at the time I was not able to understand the terms and conditions of the loan (i.e. what I would need to do to repay it).

Agree

Disagree

Couldn’t say

Due to my mental health at the time I was not able to remember what I had been told about the loan.

Due to my mental health at the time I was not able to weigh up the advantages or disadvantages of the loan.

Due to my mental health at the time I was not able to communicate my decision, ask questions, or discuss the loan with the organisation I applied to.

Due to my mental health at the time I was not able to make a decision about whether to take out the loan or not.

24%

24%

52%

18%

44% 38%

21%

45%

34%

20%

42%37%

16%

36%

47%


Agree

Disagree

Couldn’t say





Mentalcapacityatpointofsale

24%

24%

52%

18%

44% 38%

21%

45%

34%

20%

42%37%

16%

36%

47%


Agree

Disagree

Couldn’t say





24%

24%

52%

18%

44% 38%

21%

45%

34%

20%

42%37%

16%

36%

47%


Agree

Disagree

Couldn’t say





24%

24%

52%

18%

44% 38%

21%

45%

34%

20%

42%37%

16%

36%

47%


Agree

Disagree

Couldn’t say





24%

24%

52%

18%

44% 38%

21%

45%

34%

20%

42%37%

16%

36%

47%


Agree

Disagree

Couldn’t say





24


While we are not able to determine whether lenders had anyindicationorknowledgeofcapacitylimitationsatthepointofsale,thehighnumbersreportingthattheymayhavelackedcapacitysuggestsmoreconsiderationisneededofappropriatewaystoidentifyandsupportpeoplegoingthroughperiodsofpoormentalhealthintheirfinancialdecision-making.

Thisisreinforcedbythefindingthat38%ofrespondentssaytheywereunabletodecidewhethertotakeoutaloanornot,duetotheirmentalhealth.Thisself-assessmentsuggeststhatmentalcapacityatthetimeofapplyingforcreditisasignificantissueforpeoplewithmental health problems.

Bybreakingtheseresultsdownbymentalhealthdiagnosis,wecandevelopamoredetailedpictureofhowspecificmentalhealthproblemscanaffectthedifferentelementsoffinancialdecisionmaking.Alcoholdependency,bipolar,personalitydisorderandpsychosisappeartohavetheclearestlinktocapacitylimitations,while these limitations appear less prevalent in those reporting depression, anxiety and postnatal depression.

Money and Mental health will work with lenders and mentalhealthpractitionerstoconductfurtherresearchandpolicydevelopmentonmentalcapacityatpoint of sale.

Financial services Thefinancialservicessectorhasmadehugeprogressinrecentyearsinthewayitdealswithcustomerswithmentalhealthproblemswhofindthemselvesinfinancialdifficulty.Wecongratulatethosecompanieswhohaveintroducedspecialistteams,trainedfrontlinestaffinmentalhealthawareness,anddemonstratedtheimpactappropriateforbearancecanhaveonbothmentalhealthandfinancialrecovery.

Wenowurgethefinancialservicesindustrytobuildonthisworkbydevelopingproducts,settings,andsystemstohelppeoplestayoutoffinancialdifficultiesinthefirstplace.Withsuchhighnumbersreportingchangesintheirspendingandfinancialmanagementduringperiodsofpoormentalhealth,itisclearmanypeople with mental health problems need help to preventfinancialharmwhentheyareunwell.Thefinancialservicesindustryhasavitalroletoplay,usingtechnologyandinnovationtoprovidebetterbudgetingtools,settingsthatenableself-regulationandself-control,andsophisticatedpermissionsetsthatenablecarersortrustedthirdpartiestooffersupportandsupervisionduringperiodsofpoormentalhealth.

Thisisparticularlyimportantforprovidersofnewfinancialtechnologies,manyofwhicharefocusedonreducingfrictionintransactions.

Whilefrictionisoftensimplyeconomicinefficiency,formanyconsumerswithmentalhealthproblems,itisausefulcheckonharmfulbehaviour.WecallontheUK’sFinTechsectortoleadthewaybyconsideringtheneedsofconsumerswithmentalhealthproblemsinthedesignoftransactionandretailingtechnologyandfindwaystoretainorevenincreasefrictionforpeoplewhoneedthisfunctionality.

Retailers Thecreditsectorisoftenblamedforitsimpactonconsumers’mentalhealth,butitisclearfromourresearchthatpeoplewhogetintofinancialdifficultydonotdosoexclusivelytopayessentialbills.Manyofourrespondentsdescribedthedetrimentalimpactoftheretailenvironment-inparticularonline-andretailadvertisingontheirfinancesduringperiodsofpoormentalhealth.Promotionalactivitythatmaybereasonableforthemajorityofconsumerscanhaveadetrimentaleffectonsomeoneinavulnerablementalstate.Retailersmay,insomecircumstances,bebetterplacedthanfinancialservicesproviderstospotunusualpatternsofbehaviourfromparticularcustomersandhelptoprotectthem.


Ourresearchconfirmstheneedforurgentactiontohelpthosewithmentalhealthproblemsgetandstayoutoffinancialdifficulty,andtoreducetheimpactoffinancialdifficultyonpeopleandtheirfamilies.ThesefindingswillshapetheworkofMoneyandMentalHealthintheyearstocome,aswestrivetountanglethiscomplexnetworkofproblemsandidentifypractical,workablesolutionsforthefinancialservicesindustry,regulators,policy makersandhealthcareprofessionals.

Section Three - Conclusions and recommendations

26

Wethereforecallontheretailindustry,inparticularcatalogueandonline,toexplorewaystosupportcustomerswithmentalhealthproblemsseriously,aspart of the wider movement on responsible retailing.

Health professionals AsrecommendedbyMind,theRoyalCollegeofPsychiatristsandothers,healthprofessionalsshouldconsidertheimpactoffinancialdistressonpeoplewithmentalhealthproblems.Effortstodisseminatebestpracticeonidentifyingfinancialstressorsamongthose presenting with mental health problems are tobecommended,andtheriseintheavailabilityofadviceservicesinhealthcaresettings,orbyreferral,iswelcome.ManyhealthprofessionalsusetheDebtandMentalHealthEvidenceFormtosupporttheirpatientsbyprovidingproofoftheirhealthstatustocreditors,andweencouragethemtocontinuetodoso.

Inaddition,healthprofessionalsshouldbeawarewhendiagnosing mental health problems of the potential impactthoseconditionsmayhaveonaperson’sfinancialstatus,andtheriskthisposestorecovery,whethertheyarecurrentlyindifficultyornot.Earlyreferraltoadvice,orencouragementtoseekfinancialsupportfromfamilyandcarers,couldhelppreventfinancialdifficultiesfromemerging,orworsening,andpotentiallyimprovehealthoutcomes.

Our research programme Itisclearthatmuchmoreworkisneededonmappingandanalysingthefinancialbehavioursofthosewithmentalhealthproblems,andthecorrelationbetweenspending, saving and mood. Money and Mental health aimstoworkcloselywithfinancialinstitutionsandconsumerstoconductlarge-scaleanalysisoftransactiondata among people with mental health problems.

Itisalsoclearthatmanyofthoseexperiencingpoormentalhealthwouldbenefitfromadviceandsupporttoimprovetheirfinancialcapability.MoneyandMentalHealthwillworkwithadviceagenciesandfrontlinehealthservicestopilot,trialandevaluatewaystoimprovetheuptakeofdebtandfinancialadvice,andboostfinancialcapability.Inparticular,wearekeentoexplorebetterwaysofimprovingfinancialmanagementamongthosewithsevereandenduringmentalhealthproblems,workingwithexistingsupportnetworkswithincommunitymentalhealthteams.

Morethan1,500ofthosewhocompletedthesurveyhavevolunteeredtotakepartinourfurtherresearch.MoneyandMentalHealthwilldeveloparesearchpanelofconsumerswithexperienceofmentalhealthproblems,withwhomwewillworkcloselyinthefuturetodevelopandtestpolicy,productsandapproaches.

27

6,183Responseswerereceivedintotal.Ourobjectivewastocollectresponsessolelyfromthosewhohavelivedexperienceofamentalhealthproblem,however,and770weredisqualifiedonthisground,leavingatotalof5,413validresponses.Thisisnotarandomsampleofthepopulation,orofthepopulationofthoselivingwithmentalhealthproblems:

•78%ofrespondentswerefemalebutapproximatelyhalf of those with a mental health problem are female

•Theincomesofrespondentswerehigherthantheaverageamongthepopulationwithmentalhealthproblems.Thepercentageofrespondentsineachincomebandissetoutbelow,withacomparisontothedataonincomesofthosewithmentalhealthproblemsintheBritishAdultPsychiatricMorbiditySurvey(BAPMS).21

•Nevertheless,thesurveyover-representsthoseindividualswhohavefinancialdifficultiesalongsidetheirmentalhealthproblem(s)duetotheforainwhichitwassharedandtheintroductoryexplanationsusedbysomeofthosewhopublicisedthelinkforus.53%said they were behind with bills against 12% of the widerpopulationwhoreportbeingbehindwithbillsintheUnderstandingSocietysample.22

• Respondents with depression and anxiety were themostlikelytocompletethesurvey;thiscanbepartiallyaccountedforbytheheavyweightingoffemaleresponsesastheseconditionsaremostprevalentamongwomen.Howeverwealsocollectedasubstantialnumberofresponsesfromthosewithlesscommonconditions.

Qualitative data Threeresearchersanalysedthetextdatasubmittedinresponsetotheopentextquestions.Twoworkedtogethertoestablishthethemesidentifiedinthedata;thethirdworkedindependently.Theresearchersthenmettofinaliseasinglesetofthemesbasedontheirseparate analyses.

Respondents’freetextcontributionshavebeenreportedverbatim,exceptwherespellingcorrectionshavebeenmadebythereportauthors.Anyadditionforcontextor omission for brevity from the verbatim response is marked in the text with [addition] or ellipses to mark an omission.Namesoforganisationshavebeenredactedaswearenotabletoverifyclaimsmade.

Wearenotpublishingthefulltextofallsubmittedfreetextresponses.Howeverthosewitharesearchinterestareinvitedtocontactustoapplyforaccess.


Thesurveywasconductedonlinebetween4Marchand15April.ItwaspublicisedonnationalTVandradio,localBBCradioandviasocialmedia.ItwasalsosharedviatheweeklyMoneySavingExpertemailon9March,ontheMoneySavingExpertwebsiteandontheMoneyandMentalHealthPolicyInstitutewebsite.

Section Four - Methodology

21NationalCentreforSocialResearch,AdultPsychiatricMorbiditySurvey,UniversityofLeicester.200722InstituteforSocialandEconomicResearchandNatCenSocialResearch,UnderstandingSociety.UniversityofEssex.2015.

28


29

Less than £100 per week £100-£199 per week £200-£299 per week

Money and Mental health 7% 18% 18%

BaPMs 14% 22% 15%

£300-£399 per week £400-£499 per week More than £500 per week


BaPMs 12% 9% 28%

Incomebreakdown

Prevalenceofdifferentmentalhealthproblems

Anxiety Depression PTSD Personality Disorder

Money and Mental health 55% 79% 12% 9%

BaPMs 61% 52% 12% 4%

ADD/ADHD Eating Disorder Alcohol or drug dependence


BaPMs 2% 7% 17%

30


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References

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This report was written by Merlyn holkar and Polly MackenzieoftheMoneyandMentalHealthPolicyInstitutewiththesupportofNicMurray,HelenUndy,Boaz nathanson and Meredith cane.

ThesurveywasdesignedwithChrisFitch,ResearchFellowatPersonalFinanceResearchCentre,BristolUniversity,andwiththesupportofMind,thementalhealthcharity.

Theauthorswouldliketothankeveryonewhohelpedpublicisethesurvey,includingtheteamatMoneySavingExpert,Mind,GoodMorningBritain,Turn2Us,caP, cifas, MyBnk, MyWaycode, PayPlan, the BBa, BipolarUK,theCSA,andNationalDebtline,aswellasourTrusteesandAdvisoryBoard.

Most importantly of all, our heartfelt thanks go to everyone who contributed their story to our research.

Acknowledgements

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