Even without jumping into the details, it is easy to say that financial well-being is linked with peace and satisfaction in our lives. When the monetary situation is favorable, individuals have reduced risk of depression and it is associated with lower anxiety as well!
It isn’t a nice thought to be worried about borrowing money all the time. Consequently, poor financial conditions can have detrimental effect on health and may lead to:
- Lower levels of sleep
- Suicidal thoughts
- Mental disorders.
These effects are more evident in the population that is sensitive and prone to societal pressure such as single mothers or youngsters. As a matter of fact, some opt for asking friends or families to transfer funds to their account to deal with debt or emergencies which may result in stressed relationships.
On the other hand, a number of researches have highlighted the positive impact of a blooming financial situation on improved health and well-being. According to the available data, the effects were confirmed for emotional health, physical health as well as social well-being.
It’s More Complicated Than You Think!
The relationship seems to make perfect sense, however, its impact is far-reaching which we often fail to understand. The truth is that, financial situation and its effect on mental health is a vicious cycle. For example, increased financial security leads to better health outcomes which leads to healthier lifestyles such as cutting down on smoking or drinking.Eventually, you would be saving up a lot that ultimately further strengthens your monetary situation.
Similarly, the picture can be turned upside down as well.
Financial hardships may lead to reduced mental and physical health which means more expenditure on medicines or therapy that is again an increased burden on savings for any individual. Such people are prone to losing income, getting trapped in debt, or taking excessing loans that they can not pay back within the promised timeline.
Financial Safety vs Financial Capability
Financial safety often refers to how secure an individual is given his or her material wealth. In most cases, it has nothing to do with his money management skills. Financial capability on the other hand, is the capacity of a person to take care of finances amidst tough times and boost savings on his lucky days! People with higher levels of financial capability are often able to deal with money problems and make better financial decisions. With enhanced credit and debt managing skills, this population is less prone to stress and depression.
What Can Be Done?
Since this concept is well-known to policy makers now, there should be an international focus on how to address the issue and influence the population in a positive manner. In this regard, the role of health care providers can not be ignored. The situation demands more equitable access to health insurance and reduction in the need of costly therapy whenever possible.
However, states like the US may have difficulty in implementing such protocols due to weaker welfare schemes. As a result, the impact of financial income shock tends to be severe in similar developed countries.