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Debt and Mental Health: The Role of Financial Arrangement and the Distribution of Economic Responsibilities within the Couple

Caroline Henchoz, Tristan Coste, Boris Wernli

Research Framework: Debt has been little studied as a socio-economic disadvantage contributing to poor health. The literature suggests that problematic debt is linked to poorer mental health. This is attributed in part to the financial management difficulties involved, but the mechanisms of this link are poorly understood.

Objectives: This article aims to verify whether the effect of debt on mental health varies according to the financial arrangement and the distribution of economic responsibilities within the couple.

Methodology: We used the longitudinal analyses of Swiss Household Panel (SHP) data (1999-2019).

Results: While the longitudinal approach shows that the onset of problematic debt does lead to a decline in mental health, our results do not confirm the influence of financial management. However, we show that there are different types of management among indebted couples and that in most cases, only one of the spouses assumes the responsibility, the woman more often than the man. Women have the lowest level of mental health, probably because they are more often handling money of the most precarious households.

Conclusions: Financial management patterns are associated with different levels of mental health, but this relationship could not be demonstrated in an isolated event (problematic debt) measured in a one-time fashion. We hypothesize that they have a longer-term influence.

Contribution: Our study contributes to the knowledge on the socio-economic dimensions of health. By opening the black box of households, it explores financial management, a blind spot in research on the links between mental health and debt.