May is Mental Health Awareness Month, a time to foster understanding and support for mental health issues. While mental health is influenced by various factors, one area that often is overlooked is the impact of personal finances.
According to a recent Bankrate survey, more than half of Americans believe finances have had a negative effect on their mental health, up significantly from 42% last year. With inflation reaching historic highs throughout 2022, the rising costs of everyday expenses has made it difficult, if not impossible, for people to build their savings and avoid going into high-cost debt. As reported in our recent Inside the Wallets of Working Americans Report, 80% of the employees surveyed say the rising cost of consumer goods over the past year has impacted them, making it harder for 29% of them to afford necessary expenses like utility or housing costs. These financial stressors can have a direct correlation to overall well-being.
Constant worry and anxiety about money can lead to increased stress levels, sleep disturbances, depression and strained relationships. The uncertainty of how to meet financial obligations and the fear of falling deeper into debt can create a constant state of distress making it difficult to focus while at work. Many of those struggling with financial stress have endured sleepless nights, with 56% reporting negative effects to their sleep within the past year. Financial struggles can lead to or worsen depression and the added pressure of money problems can create friction within families and friendships.
Financially stressed employees tend to be more distracted, less engaged and more likely to seek another job. One in three full-time employees say that money worries have negatively impacted their productivity at work with 73% of financially stressed employees saying they would be attracted to another employer that cares more about their financial well-being.
Recognizing the urgent need for support, employees are actively seeking help from their employers to improve their financial situations and reduce the associated mental health burden. And yet, 53% of employees recently surveyed say their employer has not offered additional financial wellness benefits or compensation in response to rising prices. This presents a real opportunity for employers to provide the support their employees are looking for.
A holistic financial wellness program that includes affordable credit solutions and financial coaching can help to address the immediate source of financial stress, reducing the health consequences of high-cost debt. With a plan in place, sleep can return. And with a return to restful sleep patterns and renewed focus, combined with the money management resources of a financial wellness program, employees are better able to make the types of financial decisions that protect their mental and financial well-being.
The connection between mental health and financial well-being is undeniable, and the current financial climate has intensified the challenges faced by employees. During Mental Health Awareness Month and beyond, let us prioritize both mental health and financial well-being, and work together to create a society where individuals can thrive both personally and financially.