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Late 2021 saw the beginning of an economic crisis most of the people living in the UK have never seen before. And its effects are still being felt today.
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Here, we look at how the cost-of-living crisis began, explore how it can affect mental health, signpost towards useful money management tools, and provide real-life accounts of the consequences of the ongoing crisis.
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The cost-of-living crisis: In brief
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Once in a lifetime
In late 2021, a cost-of-living crisis began which continues to affect households across the UK.
The COVID-19 pandemic, consumer goods and energy prices, and the Russia-Ukraine conflict have all played key roles in the crisis.
Most notably in driving up inflation.
In October 2022, inflation reached
11.1%
This means that, for many people, the money they have in their pockets is less valuable than it ever has been.
In fact, in February 2023, the proportion of adults in Great Britain who reported an increase in their cost of living was
92%
Inflation has slowed in recent months, and is expected to continue to drop throughout the year.
Even so, the consequences of the cost-of-living crisis will be felt for years to come.
Statistics and figures
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The relationship between money and mental health
The cost-of-living crisis is not just a concern for people's bank accounts. Financial stress can increase the risk of mental health issues, which in turn are strongly linked with even further financial difficulties. The result is a cycle that can be hard to break out of.
People with mental health issues are...
Almost
2x
more likely to be living in poverty
Almost
3.5x
as likely to be in problem debt
Paying up to
£1,550
more each year for essential services like energy and banking
Source: Money and Mental Health Policy Institute Strategy 2019–2024
In England...
The average individual annual income is lower by
32%
for people with anxiety/depression
25%
for people with a long-term condition
29%
for people who have self-harmed
Source: Money and Mental Health Policy Institute
People with problem debt are...
Almost
2.5x
more likely to experience mental health issues
3x
as likely to have considered suicide
Source: Money and Mental Health Policy Institute Strategy 2019–2024
The link between debt and suicidality
The percentage of people experiencing suicidal thoughts increases with level of debt:
28%
no debt
35%
£1–£5k debt
36%
£5k–£30k debt
58%
£5k–£30k debt
Source: Money and Mental Health Policy Institute
Resources
Helpful tools
Stories and insights
We're all in this together
Pawel Czerwinski / Unsplash
Millions of people across the country are currently living with the consequences of the ongoing cost-of-living crisis. Although this is a daunting thought, there is some comfort to be found in knowing that we are not alone. Which is exactly what we want to create a sense of here.
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If you would like to share your story of how the cost-of-living crisis, please contact us using the button below.