How Debt Affects Mental and Physical Health?


Studies have shown debt has a negative impact on mental and physical health. The health effects of financial distress are the same whether you live in poverty or earn a high income and reside in an upscale neighborhood. And, when you fall into financial distress, your employer is unlikely to provide more than a slight raise. Bankruptcy can break the cycle and help you start over, but first, hereโ€™s how debt can affect your health.

Financial Stress: Taking It to the Limit

The Centers for Disease Control and Prevention has said suicide rates in the U.S. have increased 30% since 1999. About 16% of those who die by suicide acted due to their financial situation.

According to the National Institutes of Health, individuals with high debt-to-asset ratios tend to experience higher levels of perceived stress and depression, especially among young adults with student debt.

Debt: Is It Always Under Your Control?

While debt is often associated with maxing out credit cards and living an excessive lifestyle, these are not the most common causes of financial strain. Unemployment and redundancy, as well as sudden expenses such as home repairs or medical bills, more often lead to debt. The lack of control can trigger a downward spiral, which means youโ€™re more likely to experience issues with:

  • Mental Health: Depression, drug and alcohol abuse, anxiety, and bipolar disorder are correlated with high amounts of debt. Financial challenges increase oneโ€™s cognitive load, which can impair planning, problem-solving, decision-making, empathy, creativity, and other executive functions. Poor decision-making can lead to making poor financial decisions.
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There is a cycle here. People diagnosed with some mental health problems are more likely to mismanage their finances and make unwise decisions, such as spending money on what they canโ€™t afford. These issues range from bipolar disorder to dementia, to impulsive spending.

  • Physical Health: Chronic stress is one of the leading triggers of physical health ailments. Stress hormones act by suppressing normal body functions, including sleep, digestion, immunity, and others. Some functions may eventually stop working altogether. Debt stress often leads to back and muscle tension, ulcers, high blood pressure, heart arrhythmia, migraine headaches, and insomnia.

Another link between debt and health is a lack of financial resources to seek medical treatment. By delaying treatment for chronic conditions, an individualโ€™s health may worsen. This has been seen in people suffering from high blood pressure, diabetes, and asthma. More than half of Americans with chronic diseases say theyโ€™ve skipped medication because of the expense.

Can the Cycle Be Broken?

Whether you can break the cycle depends on your debt situation and health needs. The best step to take if debt is the primary factor is to improve your financial behavior. Planning for the future and creating a budget are good steps to take. If you regularly miss minimum payments towards the bills, ignore letters from creditors, or canโ€™t set aside funds for reductions in income or emergency expenses, itโ€™s time to rethink your plan.

The bottom line isโ€” living paycheck-to-paycheck, having high amounts of debt, and not saving for retirement can put undue stress on your mind and body. A situation leading up to bankruptcy is stressful. However, professional guidance can help you get out of debt.

At OakTree Law, we can help assess your situation and determine whether filing for bankruptcy is right for you. If so, we know how to navigate the process, so you regain financial security and get back on your feet. Call 888-428-1613 or request your free evaluation today!