To be financially healthy can mean paying your bills on time, having a savings account and managing debt — steps an individual could take that may arguably impact wellness and peace of mind. But achieving equitable financial health, a state where all individuals have a fair and just opportunity to be financially comfortable, is a responsibility of the systems put in place that shape the possibilities for effective financial management, which have made it difficult for those living in poverty to be financially secure.
Annie Harper, PhD, an instructor at the Yale School of Medicine, conducts research on how vulnerable populations, including those with mental illness, cope with poverty and financial difficulties. She has conducted research with the Connecticut Mental Health Center Foundation, the philanthropic arm of Coalition Inaugural Partner Connecticut Mental Health Center, on poverty, mental illness and action-oriented solutions for vulnerable individuals. The Connecticut Mental Health Center Foundation recruited Harper in 2012 to conduct qualitative research with clients and learn how poverty creates a barrier to mental health recovery. Building on that research, Harper conducted subsequent studies as part of the Yale Program for Recovery and Community Health, exploring finances and mental health. A 2018 article published in Social Services Review detailed the ways in which the financial services system fails to meet the needs of low-income people with mental illness. A 2019 report co-authored by Harper titled, “Banking for All: Why Financial Institutions Need to Offer Supportive Banking Features,” offers tools that can make banking more accessible for vulnerable consumers. These tools include a third-party view-only account, self-imposed spending limits and customized alerts.
“Poverty is multi-faceted, and finances and money are part of that. Having mental illness only exacerbates the issues,” Harper said in the Coalition’s 2020 Status of Health Equity Report. “Debt is the most stressing part of poverty. Layer onto that mental illness, and the stressors increase exponentially. If you can relieve some of these stressors through these banking services, you can enhance health and well-being.”
As an anthropologist, Harper is trained to consider not only individual agency, but the broader environment to understand factors that may be a barrier to an individual’s health, including financial health.
“People who grew up with financial difficulties are more susceptible to having both minor mental health problems and serious mental illnesses,” Harper said. “When you have a mental illness and when you’re struggling financially, that financial struggle is a huge barrier to your mental health recovery.”
One in five adults in the United States experiences some form of mental illness. An average of 12 million emergency department visits each year are a result of mental illness and substance use according to the National Alliance on Mental Illness, and individuals with serious mental illness are twice as likely to develop cardiovascular and metabolic diseases. Nearly 2.5 million individuals with a mental illness live below the poverty line.
Harper stresses that there are misconceptions about people with mental illness and their financial behavior; often that behavior is interpreted as a symptom of their mental health condition, when in reality it stems from the conditions of poverty in which they live.
“When you’re poor, you’re thinking about what’s happening now — the urgent thing that has to be paid now or tomorrow or next week…being poor makes it difficult to focus on the long term,” Harper says.
Problematic financial situations based on a lack of money is a condition that anyone, living in poverty or not, can understand if you replace scarcity of money with scarcity of time, Harper says, drawing on the work of Shafir and colleagues in their book, Scarcity. When you imagine what it feels like when you do not have time to do all the things that you need to do, you may begin to make unreasonable decisions. The stress from being so busy may compel you to focus on things that are not important, impacting your decision-making. “Any human being who is living in a position of scarcity cannot focus on the long term,” Harper says.
Even when dealing with the constant stress of one’s finances, Harper says it is human nature to financially reward oneself. “If in your life you don’t see financial security ahead, you’re living in financial scarcity, you don’t have enough money…what rational person wouldn’t occasionally spend and have a good time?” she says. “Everybody needs to live, everybody needs to take joy in life and if you don’t have enough money to do that, maybe it’s better to enjoy yourself for a day and struggle for three weeks…when you’re stressed, you do things that give you immediate satisfaction.”
Seeking immediate satisfaction not only includes what you purchase but may include what you decide to consume. Financial insecurity impacts food insecurity as well. “People who live in poverty tend to go for that salt, sugar, fat — immediate satisfaction type of food because it’s a short-term stress reliever and I believe shopping is the same. You feel good when you buy something,” Harper said.
Living in poverty exacerbates the social determinants of your physical health and factors out of your control affect your ability to make decisions that will positively impact your mental health over time. Non-health institutions must be involved in filling gaps to overall wellness. “The large scale change will only come when you change the systems that are responsible for financial difficulties,” Harper said. This is why Connecticut Mental Health Center Foundation helped fund a financial wellness initiative that included banks restructuring their services to assist those living in poverty, those with disabilities and those with mental illness.
An effective financial wellness program through bank services requires financial institutions to trust among people who are poor. For example, it is important that banks restructure their services to help the poor save and avoid debt. Currently, overdraft fees impose a huge financial burden on people already struggling with their finances. Immediate indebtedness such as owing a family member money or having your car towed due to unpaid parking ticket fees can be more impactful to vulnerable populations than credit card debt.
Individuals must feel empowered to take control of their finances, with the best tools that will allow them to make good decisions to keep that healthy financial behavior constant. Effective financial coaching means ensuring clients are aware of the systemic conditions in place that enabled them and others in their community to be financially unhealthy. Understanding that there is a system in place and it is not just one’s burden to bear helps to remove self-blame, shame and stress that allows those in poverty to become advocates who will work to change the system.
Developing cultural competency and scaling innovative programs through non-clinical approaches is an Actionable Strategy outlined in the 2020 Status of Health Equity Report that all sectors can integrate in their operations to ensure increased wellbeing for all citizens by 2025. These Actionable Strategies are replicable and have the potential to deconstruct and reconstruct our national health care delivery model, through focusing on the socioeconomic factors that influence our overall health and wellbeing.
The official launch event for the 2020 Status of Health Equity Report will take place February 26th from 8-10:30 a.m. at the National Press Club’s Holeman Lounge at 529 14th St. NW, Washington, D.C., 20045. You may register for the event here.