Evaluation Scotland Wales
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The damage of debt: The impact of money worries on children's mental health and well-being

Evidence type: Insight i


In England and Wales, around 2.4 million children live in households with problem debt and it is estimated that 500,000 of those children have low well-being.

In this research:

  • ‘Problem debt’ refers to households that are currently, or have in the past been, in arrears on a household bill or credit commitment.
  • ‘Well-being’ refers to how a person feels about themselves and their life (e.g. how satisfied they are with life in general and how optimistic they are about the future).
  • ‘Mental health’ refers to symptoms that a person might be experiencing (e.g. stress, anxiety or depression) as well as formally diagnosed conditions.

The Children’s Society commissioned this research as there was a lack of available research explicitly examining problem debt and children’s health and well-being.

The study

This study seeks to explore the link between household poverty, problem debt and children’s well-being and mental health.

The authors adopt a multi-method research approach, which includes:

  • A review of existing academic and grey literature.
  • New quantitative analysis of the Millennium Cohort Study (MCS) to explore links between different measures of debt and the Strength and Difficulties questionnaire which are used as a proxy measure of some mental health issues.
  • New analysis of data from the Children’s Society’s well-being survey.
  • A series of interviews (13 parents and 6 children) and focus groups (3 focus groups with 15 young people).

Key findings

In low income households, as the number of debts increase, so too does the likelihood of mental illness in children. However, there was no association between the number of debts and the likelihood of mental illness in children in high income households.

  • Problem debt is also associated with lower well-being in children. Analysis of The Children’s Society well-being survey predicted that:
    • In households with problem debts (i.e. with arrears), 23% of children have low well-being.
    • In households experiencing difficulties with debt (but not in arrears), 14% of children have low well-being.
    • Only 5% of children have low well-being in households that are not experiencing any financial difficulties.
  • Both parents and children report that experience of debt left them feeling stressed, anxious or depressed:
    • Some parents report specific symptoms like migraines, sleeplessness or losing weight or had received specific treatments (e.g. anti-depressants).
  • Shame and embarrassment were common consequences:
    • Parents may feel ashamed of not being able to manage money effectively, as well as feeling they are not in control of their lives and unable to protect their children.
    • Children may feel embarrassed that they cannot afford the same things as their peers and/or are unable to socialise to the same extent.
    • Children may also feel guilty, anxious and unable to help their parents deal with their situation – this also has an impact on their confidence and feeling of self-worth.
  • Other consequences of debt also impact upon children’s well-being including:
    • Triggering family arguments.
    • Missing out on ‘treats’ or activities leaving parents and children feeling isolated and excluded.
  • Focus groups responded well to the following suggestions for mitigating the effects of problem debt on children:
    • A statutory breathing space to allow the creation of affordable repayment plans.
    • Access to adequate financial support.
    • Access to appropriate counselling and mental health support.

Points to consider

  • Methodological limitations:
    • Quantitative sources analysed are established and relevant, but the paper contains no detailed statistical explanation of findings.
    • Qualitative methodologies are sound, but sample sizes are small.
    • The directional relationships between debt and well-being are not addressed in this paper - the causal link remains to be proved.
    • All that can be said is that problem debt and lower well-being and possible mental health issues are linked.
  • Relevance:
    • It is difficult with this type of analysis to disentangle the impact of debt from other problems whether of a monetary nature or other non-financial problems like physical health, domestic violence and pre-existing mental health or other issues.
  • Applicability:
    • This study will be applicable to those interested in children’s well-being and the relationships between debt and mental health.

Full report

The damage of debt: The impact of money worries on children’s mental health and well-being - full report

Key info

Year of publication
England and Wales
Contact information

Ilona Pinter, David Eyre, Emily Emmott, The Children’s Society