This October marks the second Mental Health Month since the start of the COVID-19 pandemic. With so much time spent living in uncertainty, it’s a great reminder to check in on our own mental health and identify areas of stress that may be having a negative impact on our overall wellbeing. One challenge that many people are experiencing right now is financial stress.
The impact of the pandemic on financial stress
The Australian Institute of Health and Welfare recently released a report1 covering the impacts of COVID-19 on Australians during the first year of the pandemic. The report highlights that many of the measures necessary to contain the spread of the virus, have had a negative impact on mental health.
Among these measures, restrictions put in place to protect our communities from the spread of COVID-19 have significantly impacted the way businesses operate and the way many people work. Research has revealed that this has been felt across many industries who have been hit hard by job losses during the pandemic, contributing to economic insecurity and high levels of financial stress.
Financial and mental health are closely linked
Working together as part of TAL’s Health Services team, Jo Hetherington, Head of Financial Health and Glenn Baird, Head of Mental Health, understand that for many people, financial and mental health are closely linked.
“Financial stress can have a significant impact on mental wellbeing, and adversely affect overall health and relationships.” says Baird.
“There are a number of warning signs that financial stress could be affecting you or those around you. Some common signs can include arguing about money, feelings of guilt about purchases and worrying about making ends meet.”
Long-term impacts on financial health
Nearly 2.8 million people withdrew superannuation from their retirement savings as part of the Australian Government’s COVID-19 early release program. The Australian Bureau of Statistics reports that most people who accessed their superannuation early due to financial hardship caused by COVID-19, used it to pay their mortgage, rent or other household bills.2
“While many people welcomed the opportunity to withdraw funds to tide them over, the long-term implications of accessing super early need to be carefully considered”, warns Hetherington.
“Accessing super early can drastically impact your future retirement income, and insurance cover may not be available on accounts that have a low balance.” She explains, “It’s important to seek independent financial advice before deciding to access funds early so that you can protect your financial security in retirement.”
Simple steps to financial piece of mind
It may seem overwhelming at first but taking steps to address your financial future can be an empowering experience, reducing levels of stress and putting you back in control.
A great place to start is with a financial professional who can support you on your journey to better financial health. They will be able to help you identify the areas that are causing you the most stress which can help provide guidance on where to focus first.
These are challenging times for our community and TAL is here to support our customers when they need us most and are facing immediate financial hardship. Find out more about our additional Financial Hardship Support during COVID-19 on our website.
There are also a number of organisations ready to help you take control and get your financial future back on track.
MoneySmart is a government website that offers simple tools, tips and calculators.
The National Debt Helpline is a not-for-profit service that offers free, independent and confidential assistance from professional financial advisers to tackle debt problems.
SANE Australia also have a COVID-19 mental wellbeing support service which can assist people who are struggling to cope during the pandemic.
Australian Institute of Health and Welfare Report, The first year of COVID-19 in Australia: direct and indirect health effects, 10 September 2021.
Australian Bureau of Statistics, Household financial resources, 21 April 2021.