The impact of financial worries on health and wellbeing

In today's economic climate, financial concerns are a significant issue for many individuals. The overall state of the economy, including factors like employment rates, inflation, economic growth, and consumer confidence, plays a crucial role in shaping these concerns.

Our Money and Mind Report reveals that a substantial portion of our survey respondents are worried about their financial situation. Specifically, 43% of respondents reported being concerned about their finances, while an additional 19% indicated that they are very concerned. This high level of concern highlights the pervasive nature of financial stress in our society.

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The physical and mental effects of financial stress

During Mental Health Awareness week, it’s important we acknowledge that the impact of these financial worries extends beyond mere concern; they have tangible effects on individuals' health and wellbeing. Our report highlights that financial stress affects both mental and physical health. A notable 51% of respondents reported that their financial concerns primarily impact their mental health, leading to increased anxiety, stress, and other mental health issues. Additionally, 29% of respondents indicated that their financial worries affect them both mentally and physically, manifesting in symptoms such as sleep disturbances, headaches, and other stress-related physical ailments.

Interestingly, although men reported suffering more mentally when it comes to worrying about finances (54% compared to 48% of women), women are more likely to suffer both mentally and physically (32% compared to 25% of men). This difference may be due to societal expectations and roles. Men may feel a heightened sense of responsibility to provide financially, which can lead to greater mental stress when they perceive their ability to do so is threatened. On the other hand, women, who often juggle multiple roles as caregivers, employees, and household managers, may experience a wider impact on their wellbeing. The physical manifestation of financial stress in women could be attributed to the added pressures of balancing these responsibilities, which can exacerbate stress-related physical symptoms such as sleep disturbances, headaches, and fatigue.

Persistent financial concerns

These levels of concern have remained stable since our last Money and Mind report in 2023. However, there was one alarming increase. The top reason cited for financial worries was the inability to afford food or basic household bills, marking a 10% increase from 2023. This rise is particularly concerning given the current economic environment, characterised by rising inflation and stagnant wages, which has put additional strain on household budgets and exacerbated financial anxieties.

Addressing financial concerns

Vanessa Hubbard, a Personal Wealth Adviser, emphasises the need for comprehensive financial planning and support services. She states:

"These findings emphasise the need for comprehensive financial planning and support services. By addressing financial concerns and providing effective strategies to manage finances, we can help alleviate the mental and physical burdens that financial stress imposes on individuals. This, in turn, can lead to improved overall wellbeing and a better quality of life for those affected."

Key financial concerns

Only 4% of those surveyed had no concerns at all about their finances. Of the 62% who were concerned or very concerned, 51% were affected mentally. The top three concerns when it comes to finances were:

• Not being able to afford food or basic household bills (35%): This concern has seen a significant increase, highlighting the growing struggle to meet essential needs.

• Not being able to save enough to retire (23%): Many individuals worry about their ability to secure a comfortable retirement, reflecting long-term financial insecurity.

• Not being able to afford to contribute towards savings (17%): The inability to save for future goals and emergencies is a common concern, exacerbating financial stress.

Financial concerns are a pervasive issue that significantly impacts individuals' health and wellbeing. Addressing these concerns through comprehensive financial planning and support services is crucial for alleviating the mental and physical burdens of financial stress.

At Schroders Personal Wealth, we aim to provide effective strategies to manage finances to help improve overall wellbeing and quality of life for those affected. As we observe Mental Health Awareness week, it's important to recognise the role of financial stability in promoting mental health and take steps to support those struggling with financial stress.