Up to one in five adults with a history of poor mental health reported they were ‘much worse off’ financially a year into the COVID-19 pandemic, compared to one in ten of those who had never had psychological problems in adulthood, according to a new study by UCL researchers.
The study, which looked at the experiences of people in their 50s and 60s living in Great Britain, found that around 20% had high levels of mental ill health throughout adulthood, and it was this group that tended to be the most likely to experience financial problems during the pandemic.
However, even adults who had not experienced symptoms of mental ill health in decades were up to one and a half times as likely to say they faced worsening financial circumstances, compared to their peers who had never had psychological difficulties.
Lead author, Dr Vanessa Moulton (UCL Centre for Longitudinal Studies) said: “The COVID-19 outbreak disproportionately affected the livelihoods and financial circumstances of adults with persistent mental health problems. However, those who had experienced symptoms of psychological distress more than 20 years ago also remained more susceptible to the economic shockwaves of the pandemic than those who never had mental health problems. This new study puts into focus the long-lasting impact poor mental health can have, and how abrupt economic events can heighten earlier vulnerabilities.”
Published today in Social Psychiatry and Psychiatric Epidemiology, the study examines data from more than 14,000 adults born across England, Scotland and Wales in 1970 and 1958, who are being followed by the 1970 British Cohort Study and the 1958 National Child Development Study respectively. The researchers compared how people with different histories of mental health in adulthood fared financially between March 2020 and March 2021, when they were aged 50 and 62. Study participants were asked whether their financial situation had got worse, better or stayed the same during the pandemic, if their employment status had changed, and what actions they had taken to manage their personal finances. The researchers took into account other factors that could have affected their mental health or financial circumstances, such as family socioeconomic status.
Across both age groups, those who had consistently poor mental health across adult life were almost three times as likely to receive financial help or borrow from friends and relatives during the pandemic, compared to those who had never had mental health problems (1958: 5.8% v 2.0%; 1970: 7.8% v 2.7%). In addition, they were up to two and half times more likely to take out bank loans or use credit cards to manage their increased financial needs (1958: 4.7% v 1.8%; 1970: 7.3% v 3.9%). They were also more likely to make new benefit claims (1958: 24.3% v 18.7%; 1970: 22.5% v 15.7%) and take payment holidays from mortgage, rent, council tax or other interest or debt repayments (1958:12.4% v 6.9%; 1970: 19.1% v 14.7%).
Among the 1958 generation, those who experienced psychological problems in their early 30s but had since improved were twice as likely to have increased financial help from friends and family as their peers with no history of mental ill health in adulthood (4.2% vs 2%). Among those born in 1970, those who had poor mental health in their mid-20s were one and a half times more likely to borrow from banks and use credit cards than their peers who had never experienced mental health problems in adulthood (6.1% v 3.9).
Dr Moulton added: “The economic policy measures taken by the government during the pandemic were broadly successful in insuring households against the economic shocks of COVID. Despite this support, most groups who had experienced psychological distress before the outbreak were at greater risk of worsening financial circumstances. They were more likely to borrow from banks and take payment holidays from mortgages and other loans, potentially increasing their debt.
“These people more so than others are likely to be vulnerable to the end of COVID financial supports, increases in the cost of living, and economic recession. With the cycle of poor mental health and personal debt a potential ticking time bomb, it remains to be seen how those with poorer mental health across their lives manage these new economic upheavals. The government must now focus on longer term solutions to improve mental health support and access to financial guidance.”
The study is based on data from two observational studies that have been following individuals from birth and across the whole of their lives. This rich life course data has allowed the researchers to make use of very detailed data to account for a wide range of factors when examining the link between pre-pandemic mental health and financial circumstances during COVID, including early-life socioeconomic factors, and childhood indicators of health and cognitive ability.
However, despite the use of these rich life course data as controls, the authors noted the challenges in establishing cause and effect, since it is impossible to rule out that there could be other, unobserved factors that have not been accounted for, that could also explain the association between mental health and financial circumstances.
Notes to editors
For more information or to speak to the researchers involved, please contact:
Ryan Bradshaw, UCL Centre for Longitudinal Studies. T: +44 (0)20 7612 6516
Meghan Rainsberry, UCL Centre for Longitudinal Studies. T: +44 (0)20 7612 6530
Adult life-course trajectories of psychological distress and economic outcomes in midlife during the COVID-19 pandemic: evidence from the 1958 and 1970 British birth cohorts by Vanessa Moulton, Alice Sullivan, Alissa Goodman, Sam Parsons and George B. Ploubidis is available on the Social Psychiatry and Psychiatric Epidemiology website.
Study methodology notes
Mental health measures
From early adulthood to midlife, those born in 1958 (at ages 23, 33, 42 and 50) and 1970 (at ages 26, 34, 42 and 46) answered a series of questions to measure symptoms of poor mental health.
The researchers used sophisticated statistical methods to examine patterns in the data, which grouped study participants into five trajectories based on severity, timing and duration of poor mental health experienced across adulthood. Although the five trajectories were not identical in the two cohorts, some of the groupings were very similar.
Among the 1958 group, 41% had no symptoms of poor mental health during adulthood, 20% had persistent high symptoms and 11% reported high symptoms in their early 30s, with improving mental health up to midlife. Among the 1970 generation, 53% had no symptoms of poor mental health during adulthood, 19% had consistently high levels of poor mental health, and 9% had symptoms in their mid-20s with improving mental health up to midlife.
Employment and finances
Participants across both studies took part in three online surveys during the first year of the COVID-19 pandemic. The first survey was conducted during the first national lockdown, between the 4 and 26 May 2020 (Wave 1: 1958 National Child Development Study N: 5,178; 1970 British Cohort Study N: 4,223), the second between the 10 September and 16 October (Wave 2: 1958 N: 6,282; 1970 N: 5,320) when the first national lockdown had been lifted, but restrictions on social contact still remained, and the third survey during the third national lockdown, between the 1 February and 21 March 2021 (Wave 3: 1958 N: 6,757; 1970 N:5,684)
There were two outcomes capturing change in economic circumstances asked at all three time points: change in financial situation and change in employment circumstance from before the pandemic to during the pandemic.
Change in financial situation was assessed by asking, ‘overall how do you feel your current financial situation compares to before the coronavirus outbreak’: much worse off, a little worse off, about the same (reference category) or a little/ much better off. Change in employment status was derived by asking in the first COVID survey what their employment status was just before the first coronavirus outbreak, and then at each survey during the pandemic.
In addition, participants were asked what they had done to mitigate the economic shock, including, made any new benefit claims, took payments holidays, borrowed money from family and friends, borrowed money from banks, used credit cards, reduced consumption or used savings.
Up to one in five adults with a history of poor mental health reported they were ‘much worse off’ financially a year into the COVID-19 pandemic, compared to one in ten of those who had never had psychological problems in adulthood (1958: 19.9% v 10.6% 1970: 18.0% v 9.7%). Among those born in 1958, those who experienced psychological problems in their early 30s but had since improved were one and a half times more likely to be worse off during the pandemic (14.9% v 10.6%). Among people born in 1970, those who had mental ill health in their early 20s but had since improved were also more likely to be worse off (12.0% v 9.7%).
About the data
This study uses data from two nationally-representative birth cohort studies: the 1958 National Child Development Study (NCDS) and the 1970 British Cohort Study (BCS70). NCDS has followed the lives of 17,000 people born in England, Scotland and Wales during one week in 1958. BCS70 follows a cohort of 17,000 people born in England, Scotland and Wales during one week in 1970. The studies are managed by the Centre for Longitudinal Studies at the IOE, UCL’s Faculty of Education and Society, and funded by the Economic and Social Research Council.
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