In general, South Africa has one of the highest levels of household debt in the world, with many people struggling to make ends meet and pay off debt. A report from BusinessTech estimated that consumers had 20% more unsecured debt in 2022 compared to 2016. Those South Africans taking home R20,000 or more have unsecured debt levels that are 54% higher than in 2016. These insights from Bloom reveal how finances are affecting your mental health. Discover what you can do to ease the burden of financial stress and worry.

Debt and financial hardship in South Africa

High levels of unemployment, the rising cost of living, and the lack of access to proper credit have all contributed to the high levels of debt in the country. Factors such as these, as well as the economic downturn caused by the COVID-19 pandemic, continue to impact the number of people who currently face mounting financial and debt problems.

What is good mental health and why does it matter?

Good mental health is characterised by a state of well-being where a person is able to cope with normal stresses and is able to lead a balanced social and personal life, work productively, and make a contribution to their community. It is the ability to think, feel and act in ways that enhance your ability to enjoy life and deal with the challenges that life presents. This includes the ability to maintain healthy relationships, have a sense of purpose, and the ability to experience a range of emotions without it overwhelming the person or reducing their quality of living.
Mental health will fluctuate and change throughout a person’s life, depending on certain stressors like situations or adversities. That means you can expect to experience challenging mental health issues at some point. The way people react to these issues will depend on their own coping capabilities, which can either assist in their recovery or make the condition worse.

A leading cause of many mental health issues, like depression or substance abuse, is financial issues. Loss of a job, growing debt, the poor economy or burdensome financial responsibilities can all affect a person’s state of mind.

How can you tell if your finances are affecting your mental health?

Financial stability can help reduce stress and provide a sense of security and independence. It allows people the liberty of freedom and control. They can afford to make better choices and even enjoy some luxuries in life. Financial security is directly linked to the areas of self-worth and self-esteem. That means we often measure our sense of worth by how well we’re doing from a financial perspective. 

On the other hand, financial instability can severely impact a person’s mental health as financial stress leads to anxiety, depression and even physical health problems like stomach ulcers or high blood pressure. It can also affect your social and professional relationships and cause strain on your personal or work environment. A lack of financial stability will lead to feelings of insecurity and lack of control. These are just some of the effects of your finances affecting your mental health and include: 

• Stress and anxiety. Financial problems cause a lot of stress and anxiety. It’s understandable if you experience feelings of helplessness, panic or even hopelessness if you simply don’t have the necessary funds to pay for school fees or cover the home loan bond, for instance. It’s can be worse if there doesn’t appear to be a solution at hand. 
• Lack of focus and indecision. Having financial problems means that you could experience episodes of distraction. If you’re constantly worrying about your financial issue or problems, chances are high that you won’t be in a position to concentrate on any other tasks, whether they’re simple or complex. This could lead to indecision or to poor decisions being made. 
• Mental health conditions. Financial problems are a leading cause of many mental health conditions, like depression. There is a direct link between overwhelming feelings of worthlessness and lack of control and depression. Post-traumatic stress disorder, substance abuse and obsessive-compulsive disorders have all been linked to financial problems. 
• Poor relationships. Money and finances can put a strain on any relationship, both personal and professional. This is because it causes conflict and tension, or even a breakdown in communication and trust. 
• Sleep disturbances. Insomnia, hypersomnia or poor-quality sleep cycles are all linked to excessive worry brought about financial problems. A person who is not sleeping properly will become fatigued, irritable and have difficulty concentrating. It can also contribute to physical conditions, like obesity or cardiovascular disease. 

Poor coping methods. Financial problems can lead to unhealthy coping mechanisms, like emotional eating, substance abuse or engaging in distracting activities These types of unhealthy or risky behavioural patterns will only worsen the financial and mental health problems.

The best way to balance your finances and mental health

Now that it’s been established how your finances are affecting your mental health, it’s important to discuss how to alleviate the stress surrounding financial problems. Some of the best ways to find a balance include:

1. Learn how to create a budget. Get some help from an expert if you need help. Setting realistic limits and practising self-discipline will afford you more control over your finances. It will also help you identify problematic areas – where is money being wasted or what could you cut down on? 
2. Prioritise needs over wants. Decide what’s really needed in your life and prioritise those areas. You may decide that you don’t really need the expensive gym contract and can still work out by running each morning. By focussing on these areas, it will not only help reduce your financial obligations but also reduce stress and anxiety. 
3. Use a professional. If your financial problems are mounting and you don’t know what to do or where to start, then it’s advisable to seek out professional help from a debt advisor or an accountant. It will be money saved in the long run. Likewise, if your finances are causing significant stress in your life, Bloom advises support from a registered counsellor or mental healthcare professional. 
4. Manage debt effectively. It may seem like a mammoth task but you can overcome debt with the right attitude and strategy. Once you’ve worked out your budget, you can decide how you plan to pay off your debt. 
5. Practice self-care. This is important when managing stress and anxiety. Self-care practices, like exercise, meditation or constructive communication are some ways that you can gain a healthy perspective on the situation and reduce poor mental health. 
6. Be forgiving. We are often very self-critical. Remember that mistakes happen and setbacks will occur. Be kind and patient with yourself. Don’t allow your current situation to affect your future. Commit towards your financial stability and mental health.

Get affordable medical aid or health insurance with Bloom

Having access to top-quality medical facilities and services is one thing you won’t have to worry about with Bloom. We offer affordable health insurance, medical aid and GAP cover to suit your budget and individual needs. Contact our offices and make an appointment with a trained consultant.