Financial stress is on the rise in Australia. Here’s what to do if money worries are affecting your mental health

Stories about interest rates and cost-of-living often focus on Australians’ hip pockets. But what about the impact on our mental health?

The National Mental Health Commission’s most recent “report card” shows financial stress has taken a significant toll in the last few years.

It found the proportion of people finding it “difficult” or “very difficult” to cope on their income doubled from 17.1% in November 2020 to 34.6% in January 2024. Women consistently reported higher levels of financial stress compared to men.

More people are also delaying seeing a mental health professional due to cost – or not seeing one at all (20.4% in 2023–24, compared to 12% in 2020–21).

But whether you’re experiencing a job loss, struggling with debt, or just worried about day-to-day expenses, it’s important to take your mental health seriously.

Financial stress and mental health

We often focus on the medical aspects of mental health, for example, whether someone has a certain mental health condition such as depression or anxiety.

But broader social factors can also influence our mental health, including access to housing, income, unemployment and food insecurity. These are known as social determinants of health.

These are the things that often feel out of our control – and therefore can make us feel helpless. The report card also found people who experience a high sense of control over their lives declined slightly between 2019 and 2023.

Being able to save and pay off debt is linked to significantly better mental health.

In contrast, having to forgo meals or medicine, or struggling with bills and rent or mortgage payments, is stressful and over time can affect our physical and mental health.

Financial stress can lead some people to develop anxiety or depression, or use alcohol and drugs to cope. If you have a pre-existing mental health condition, it can also make things more challenging.

We also know that rates of suicide are often higher in groups that experience economic disadvantage and financial hardship.

Signs financial stress is taking a toll

Feeling overwhelmed can make it harder to take care of yourself, but it’s important – and will also make it easier to work through your financial situation.

Try taking one step at a time. The first is to take notice of what is happening.

Signs financial stress is affecting your health and/or relationships might include:

• arguing a lot about money
• having difficulty sleeping
• fatigue
• feeling angry, scared or experiencing mood swings
• feeling guilty and worried about spending money
• delaying health care because of the cost.

These are normal responses to money stress. But if they’re not addressed, they may lead to further difficulties.

Understanding your relationship with money

Mental distress can also affect how you deal with your personal finances – and make it harder to get on top of them.

For example, people who have struggled with money in the past – or who grew up in circumstances without much money – may have a difficult relationship with managing finances.

You may have patterns of behaviours – such as frequently spending above your means or borrowing money – that make you more stressed about money. Maybe you cope by avoiding the problem, ignoring emails from banks or not reading bills.

Some people may find it helpful to understand how money is linked to emotional wellbeing. This means getting to know your money and mood patterns.

You might start by keeping a diary of your spending and your mood, considering when you’re more likely to spend and why, what emotions come up, and how best to manage them.

Beyond Blue’s money, financial wellbeing and mental health quiz is another good place to start.

Where else to get help

Beyond Blue and the National Debt Helpline provide a breakdown of what might be causing financial distress and can help you find free financial counselling.

Free online tips and advice about managing your finances and household debt are also available via the government website MoneySmart, or Financial Counselling Australia (a not-for-profit).

For mental health symptoms, such as trouble sleeping or feeling anxious, Medicare Mental Health is a free service that connects you with support services, either via the website or by calling 1800 595 212 (weekdays 8:30am – 5pm). You can also talk to your GP.

Remember, no matter how difficult the situation, it’s never too early – or too late – to get support.

If this article has raised issues for you, or if you’re concerned about someone you know, call Lifeline on 13 11 14.