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The Impact of Poverty on Mental Health

Published: March 17, 2021 Updated: November 25, 2022
Published: 03/17/2021 Updated: 11/25/2022
Headshot of Robert Hinojosa, LCSW
Written by:

Robert Hinojosa

LCSW
Headshot of Dr. Kristen Fuller, MD
Reviewed by:

Kristen Fuller

MD
  • How Poverty Can Impact Mental HealthImpacts
  • The Impact of Poverty on Child DevelopmentChild Development
  • How Mental Illness Increases the Risk for PovertyMental Illness Risks
  • Barriers for Accessing Mental Health TreatmentTreatment Barriers
  • How Should Someone Living Below the Poverty Line Find Mental Health Care?Finding Care
  • Final Thoughts on Poverty & Mental HealthConclusion
  • Additional ResourcesResources
  • Impact of Poverty on Mental Health InfographicsInfographics
Headshot of Robert Hinojosa, LCSW
Written by:

Robert Hinojosa

LCSW
Headshot of Dr. Kristen Fuller, MD
Reviewed by:

Kristen Fuller

MD

When people face both mental health issues and poverty, the results can be disastrous. Poverty is often a cyclical experience, creating increased stress and less access to resources, making it much harder to manage a mental health disorder or even access treatment in the first place.

In 2021, the Federal Poverty Level (FPL) annual income for an individual is $12,880 in the contiguous 48 states. For a household of three, that level is $21,960 a year.1 That is roughly $1,800 a month, which obviously goes only so far, depending on the cost of living where you live. In September 2020, 77,306,714 individuals were enrolled in Medicaid and CHIP in the USA.2

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How Poverty Can Impact Mental Health

Access to quality mental healthcare is sometimes limited because of reliance on overwhelmed community mental health agencies, and public healthcare benefits. It is especially the case for those whose income falls just above the poverty line, making them ineligible for public health insurance and state or federal programs that provide access to discounted mental health care.

For those struggling with both poverty and mental health issues, sometimes the decision has to be made between making rent and purchasing needed medication, or paying for mental health services. This leads to an increase of those in poverty who cannot access needed mental health treatment, which in turn can lead to not being able to hold down employment, or possibly worse depending on their mental health condition, and overutilization of emergency services.3

Johannes Haushofer, Assistant Professor of Economics, Stockholm UniversityAccording to Johannes Haushofer, Assistant Professor of Economics, Stockholm University, “Poor mental health may affect economic well-being: When someone has depression, it can be hard to earn a living, because it is hard to get out of bed, relationships deteriorate, and you may even lose your job. As a result, people drift into poverty. Conversely, poverty may lead to poor mental health—it can be depressing if you can’t provide the life you want for your family and yourself.”6

Poverty & Anxiety

Poverty increases various stressors both individually and on a family level that can cause anxiety. It can mean increased stress related to obtaining food, maintaining housing, earning income, and planning for the future.

On a personal level, that stress can translate into things like high blood pressure, poor nutrition, and other health issues, which further exacerbate anxiety. According to the Anxiety and Depression Association of America, “8.7% of people with incomes below the poverty line report severe psychological distress.”4

Poverty & Depression

Symptoms of depression can be worsened by poverty and stressors in life. Someone whose income is already below the poverty line may experience increased complications because of a loss of a job or drop in hours at work. This can, in turn, increase suicidal thoughts or trigger severe depressive episodes. This can further impact those individuals financially due to the use of emergency services and medical bills that result.

Poverty & Substance Use Disorders

The CDC reports that heroin use is almost three times more prevalent in families with incomes below $20,000 a year compared to families with incomes above $50,000 a year.5 Substance use alters the brain to be more impulsive and pleasure seeking. Substance abuse lends itself to poverty, and sometimes is the cause of poverty. At the same time, the stressors of poverty can lead some to self-medicate, leading to increased substance abuse.

The Impact of Poverty on Child Development

There are two main effects that poverty has on child development. One is social, and the other is health-related. Socially, these effects stem from things like access to services, education, and opportunities. Children with less access to services, education and opportunities because of poverty have less chance at success later in life. They also tend to have higher instances of stress and are likely to continue a cycle of poverty in their adult lives.

From a health standpoint, poverty affects long-term health of children through aspects of Social Determinants of Health (SDOH). SDOH refers to things like access to food, transportation, safe living conditions, education, and support. Poor living conditions and lack of access to nutritious food can lead to long-term health conditions affecting both psychology and development, such as obesity, diabetes, and chronic stress.

How Mental Illness Increases the Risk for Poverty

Unmanaged mental health conditions can possibly lead to poverty. This is largely dependent on access to services and severity of the mental health condition. Those with very debilitating mental disorders may find that they cannot work, and therefore must rely on public benefits such as SSI and Medicaid.

More moderate mental health conditions may have an effect on your ability to work, such as interruption in hours or type of work that can be tolerated/performed. Because of this, some people find that their earning potential is significantly limited. Additionally, other responsibilities, such as maintaining housing or paying utilities on time, or even impulsive decisions related to spending may impact financial stability leading to homelessness, debt, and poverty.

Barriers for Accessing Mental Health Treatment

Some of the largest barriers to accessing mental health treatment have to do with things called Social Determinants of Health (SDOH). SDOH includes elements like access to services, adequate housing, access to nutritious food, transportation, and education on healthcare and the ability to navigate the healthcare system.

Many impoverished populations live far from their most needed resources, making affording transportation, or getting to appointments difficult. Mental health services are sometimes expensive, especially if you fall outside poverty levels and must meet deductibles with insurance, or do not have insurance. Medications often have a copay, which can be a barrier to those who are living paycheck-to-paycheck as is.

What Steps Are Being Taken to Address These Issues?

Many municipalities and states are making changes to services that are offered to people with disabilities and mental health conditions. Expansion of Medicaid services is one way that this is being addressed. Also, many insurance companies are implementing care management services, which help their members address SDOH in their lives.

More and more employers are starting to offer benefits to even part time employees to gain access to employee assistance programs, which can oftentimes help improve access to mental health services. The explosion of telemental health services also brings mental health services to people who may not have been able to access services otherwise, oftentimes at a discount.

How Should Someone Living Below the Poverty Line Find Mental Health Care?

If your income falls below the poverty line, it is likely you can qualify for public benefits in your state. Ask your local Medicaid office about if you qualify for services. If not, you may be able to get a discounted health insurance plan through healthcare.gov. Obtaining health insurance opens up access to many mental health services that are otherwise difficult to access.

A quick google search of “Community Mental Health Near Me” can bring up many results of agencies in your area that offer community based mental health services at a discount or free. Many of these agencies will also help you obtain Medicaid if you qualify, as they often offer case management services as part of their service offerings.

Finally, if you cannot afford treatment co-pays, or cannot qualify for Medicaid, you may choose to look for “sliding scale” services. These are therapists and counselors that offer discounted rates for people based on things like income or need. There are also networks that exist to help connect people with these therapists, such as Open Path Collective.

Final Thoughts on Poverty & Mental Health

The important thing to know about both poverty and mental health is that they play into each other, and when you start addressing one, the other often can improve. Your mental health often impacts finances and decisions more than you realize, so if you have a mental health disorder, be sure that you are getting and cooperating with treatment.

Financial distress plays into mental health problems, and can worsen symptoms at times. If you find you are struggling financially, actively search for ways to address your financial concerns. Remember that long-term solutions do not always look appealing, such as saving an emergency fund and cutting back on spending. It will take some discipline, but making smart decisions on how much you spend on housing and other essentials will positively impact your life and mental health.

Additional Resources

Education is just the first step on our path to improved mental health and emotional wellness. To help our readers take the next step in their journey, Choosing Therapy has partnered with leaders in mental health and wellness. Choosing Therapy may be compensated for marketing by the companies mentioned below.

Online Therapy 

BetterHelp Get support and guidance from a licensed therapist. BetterHelp has over 20,000 therapists, who provide convenient and affordable online therapy.  Complete a brief questionnaire and get matched with the right therapist for you. Get Started

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For Further Reading

  • Mental Health America
  • National Alliance on Mental Health
  • MentalHealth.gov

Impact of Poverty on Mental Health Infographics

The Impact of Poverty on Mental Health Result of Mental Health Issues and Poverty Severe Psychological Distress Among People Below the Poverty Line

How Poverty Can Impact Mental Health Poverty Consequences on Mental Health Mental Health Conditions Leading To Poverty

Barriers for Accessing Mental Health Treatment Getting Mental Help For People Below the Poverty Line How Addressing Mental Health Leads to Solving Poverty

6 sources

Choosing Therapy strives to provide our readers with mental health content that is accurate and actionable. We have high standards for what can be cited within our articles. Acceptable sources include government agencies, universities and colleges, scholarly journals, industry and professional associations, and other high-integrity sources of mental health journalism. Learn more by reviewing our full editorial policy.

  • Office of The Assistant Secretary For Planning and Evaluation. (February 1, 2021). U.S. Federal Poverty Guidelines Used To Determine Financial Eligibility For Certain Federal Programs. Retrieved from https://aspe.hhs.gov/poverty-guidelines

  • Centers for Medicare & Medicaid Services. (January 15, 2021). September 2020 Medicaid & CHIP Enrollment Data Highlights. Retrieved from https://www.medicaid.gov/medicaid/program-information/medicaid-and-chip-enrollment-data/report-highlights/index.html

  • Anne Zink. (October 18, 2018). Mental health patients, with nowhere else to go, are overwhelming emergency departments. Retrieved from https://www.statnews.com/2018/10/18/mental-health-care-emergency-departments/

  • Anxiety and Depression Association of America. (2021). “Low-Income Communities.” Retrieved from https://adaa.org/finding-help/low-income-communities

  • Centers for Disease Control and Prevention. (July 7, 2015). Today’s Heroin Epidemic Infographics. https://www.cdc.gov/vitalsigns/heroin/infographic.html

  • Haushofer, Johannes. (2021). Personal Interview.

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Headshot of Robert Hinojosa, LCSW
Written by:

Robert Hinojosa

LCSW
Headshot of Dr. Kristen Fuller, MD
Reviewed by:

Kristen Fuller

MD
  • How Poverty Can Impact Mental HealthImpacts
  • The Impact of Poverty on Child DevelopmentChild Development
  • How Mental Illness Increases the Risk for PovertyMental Illness Risks
  • Barriers for Accessing Mental Health TreatmentTreatment Barriers
  • How Should Someone Living Below the Poverty Line Find Mental Health Care?Finding Care
  • Final Thoughts on Poverty & Mental HealthConclusion
  • Additional ResourcesResources
  • Impact of Poverty on Mental Health InfographicsInfographics
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