Psychiatrists track mental health debt link

09/10/2009

A wide-ranging new study suggests that 50 per cent of people with debt also have mental health problems.

The report, published by The Royal College of Psychiatrists and Rethink with the assistance of the Money Advice Trust and the Finance & Leasing Association, also suggests that the more severe the health problem, the bigger the debts.

Money problems have become more acute with the onset of the credit crunch, increasing demand for debt advice about bills and other services provided by debt management companies.

Home repossessions are forecast to rise from 40,000 in 2008 to 65,000 this year and unemployment has hit a 14-year high.

Moreover, data from financial charity Credit Action shows that indebted households owe an average of over £20,000 each on credit cards, personal loans and other forms of unsecured credit.


Comedian Stephen Fry said: "My own bipolar condition has caused me to go on many giddy spending sprees so I have first-hand experience of the difficulties of debt brought on by poor mental health.

"An understanding of the relationship between mental health and unmanageable debt should ensure that appropriate advice and support is provided to those who need it."

Kevin Still, EuroDebt director, added: “EuroDebt has trained front line debt advisors with regard to the Money Advice Liaison Group (MALG) best practices in respect of Debt Management and Debt Collection for people with mental health problems. This includes use of the jointly evidence forms where a prospective client volunteers the fact that they may have a mental health condition. It is our experience that mental health can have a contributory effect on a person’s ability to deal with financial stress and debt problems.

"Self management of personal debt may not be appropriate in these circumstances. Providing better protection to people suffering a variety of mental health conditions is important, but for the majority that doesn’t mean that they can walk away from their debts."

Newham Council in East London was criticised by the Local Government Ombudsman earlier this week for making a woman with mental health problems bankrupt after she failed to pay her council tax.

The resident, who has since been granted an exemption by the council, had health problems which prevented her from managing her finances properly.

Tags; Income Worries and Debt, Credit Card Lifestyle, Recent Graduate Debt,

Regional Debt Advice; Debt Help East London, Debt Help London,

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