Becoming Banked Improves Mental Health

Adam Rust

Data from the Health and Retirement Study (longitudinal, 2000 through 2012) found that among Hispanics, being banked led to positive effects on mental health.

Analysis of data from the Current Population Survey concluded that unbanked status correlated to a 17 percent higher prevalence of material and stress effects related to health.

A focus group study of clients and social workers at an urban community mental health center found numerous challenges among clients to navigate finances. Staff expressed frustration at the lack of support services available to help their clients manage money.

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Mental health financial stress

Financial stress is a product of other common manifestations of economic insecurity. When they use a traditional checking account, they often incur overdraft fees. When they are unbanked, they are more likely to have their utility services disconnected. A Yale researcher who interviewed mental health patients of a clinic in New Haven commented that “It is difficult to overstate just how devastating financial problems can be for people living with mental illness.”

Research finds that general-population health outcomes have a statistically significant negative correlation the level of use of fringe alternative financial services. The relationship was most robust with all-cause mortality but also for cancer mortality and alcohol and drug-related mortality.

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