More Americans say financial woes are hurting their mental health
Rising interest rates, inflation and unstable income are damaging the mental well-being of a growing number of Americans, according to a new survey from Bankrate.
Money was cited by 52% of survey participants as having a negative impact on their mental health. That's more than any other factor cited, including concerns about health or relationships with family and friends, and a significant rise from the 42% of respondents who point to financial concerns last year.
Of those participants, 82% said they worry about money at least once a month and that those concerns cause them stress and anxiety, as well as loss of sleep and depression. The survey found that 57% of respondents think about money every day, compared to 52% last year.
The survey shows that Americans are increasingly worried about inflation, as well as about being in debt, paying for housing and lacking enough funds for emergency or discretionary spending.
"Despite a strong job market, wage growth has not kept pace with the rising cost of living. Debt has been rising and savings have been dwindling," Ted Rossman, senior industry analyst for Bankrate, said in a report that accompanied the survey, in which the personal finance firm polled 2,300 U.S. adults last month.
The survey adds to a growing list of government data, polls and independent research, all of which paint many U.S. households as being under financial stress.
Total credit card debt reached a record $4.8 trillion in March, according to Federal Reserve data, as many low- and even middle-income families are increasingly turning to credit cards to purchase essentials like groceries.
The Fed's series of interest rate hikes in its ongoing battle to bring down inflation has caused credit card rates to skyrocket, experts said. The interest rate on those debts have also reached a record high, hitting an average 22.1% during the first quarter of 2023, according to WalletHub. Rates on auto loans, mortgages and other lines of credit have also climbed this year.
A January survey from NerdWallet found that three quarters of Americans aren't confident about their personal finances in 2023, mostly because of uncertainty in the economy.
Although inflation has started to cool in recent months, the price of food, electricity, fuel and housing has remain elevated.
"Inflation really hit us hard this year, opposed to prior years," Kansas State University financial planning professor Megan McCoy said in Bankrate's report. "It hit the average American much more closely because it was reflected directly in our gas or in our grocery bills."