How does money impact our mental health?

The coronavirus pandemic has brought many challenges, but one of the most universal issues that people of all ages have faced as a result of lockdown, and other restrictions placed on our lives, is the worsening of their mental health.

Statistics show that one in four adults is likely to have a mental health problem at some stage in their lives, but all too often, a lack of understanding of mental health issues means the topic doesn’t get the air time it deserves.

Covid-19 has affected everyone and the widespread stress and anxiety it has caused has, in some ways, helped highlight that mental health issues can affect anyone and helped break some of the stigma that still existed around talking about mental health.

Money and your mental health

As a bank, we are very aware that mental health and money problems are intricately linked. Financial stress and anxiety can be really difficult to deal with at the best of times, and the uncertainty around the impact of coronavirus won’t help that – and may even cause some new anxiety around financial security.

We know from experience that poor mental health can make earning and managing money harder and the subsequent worry about money can make mental health worse - a vicious cycle that can be hard to break.

Research from the Money and Mental Health Policy Institute found that people experiencing mental health problems are three and a half times more likely to be in problem debt than people without these problems and almost 90% of nearly 5,500 people with experience of mental health problems said their financial situation had made their mental health problems worse. Its research also showed that almost half of all people in problem debt also have a mental health problem.

If you’re in this position, it can be hard to see how to get out of it and even starting to sort things out might feel like an overwhelming task.

The first step is to understand financial stress – how is money connected to your mood? And how does your mood impact your spending?

The feelings associated with financial stress may trigger other feelings and side effects such as anxiety, insomnia, depression, social withdrawal, relationship difficulties.

What to do?

Anyone can have anxious feelings and worry about money, but how you deal with that worry has a huge impact on your wellbeing.

From our experience of working with customers in financial distress, here are some tips on how you can start to manage it:

1. Talk to someone

It might sound obvious but it is so important to open up and talk to someone – share the problem, don’t suffer in silence. Could you talk to: your GP; a trusted friend; your bank; money charities or organisations specifically set up to support people in your situation? There are many great organisations that can help, including: Extern; Money and Mental Health; Money Advice Service; and the Money Advice Service’s Navigator Tool; the NHS; Advice NI; Action Mental Health;

2. Don’t ignore the problem

Talk to us (or your own bank) – we can look at your situation and help work through how we can support you.

Take a look at your money habits – do certain things in your life trigger spending, or do certain aspects of banking trigger anxiety? Some people get to the point where opening letters or answering phone calls from their bank becomes a trigger, but you can manage this sort of anxiety with some help.

3. Look at a budget

Take stock of all your incomings and outgoings – what are you spending money on, could you make any savings with any of your spending? Organising your finances and understanding where your money is going will set the groundwork for avoiding future overspending.

4. Make your plan and stick to it

If there are things that encourage you to spend without thinking, look at how you can avoid them. Shopping apps on your phone, and your phone in general, can make it too easy to buy without thinking - for example, if your phone or websites you use regularly autofill your card details, clear them. If you are using ‘buy now pay later’ schemes, like Klarna or Clearpay, clear and close your accounts with them – only spend what you have.

5. Look at other ways to deal with stress in general

Looking after your general wellbeing can help alleviate some of the pressures of financial stress. Again, it might sound obvious but take up exercise; learn a new hobby; get outside; eat healthy foods; try meditation or apps like Calm and Headspace. Positive habits make a difference to other parts of your life.

Above all, try not to be too hard on yourself. Anxiety and stress about money is not uncommon and you can overcome it. Extern have produced some really useful toolkits full of tips, advice and a host of simple activities and information on how to approach and alleviate mental health issues.


With some uncertain months ahead of us, we would really urge anyone suffering from anxiety related to their finances, or in general, to talk to someone about it. This is the first step to getting on top of the situation.

If you are a Danske customer and are in or think you are in danger of getting into financial difficulty you can find information about how to address the situation with us here. Please get in touch, we want to hear from you and we want to help.