Why Financial Security Is the Missing Piece in Australia’s Mental Health Conversation
Australians are feeling the pinch. With living costs climbing faster than wages, many households are struggling to cover everyday expenses. This growing financial pressure is not just an economic issue. It has become one of the leading drivers of mental health challenges across the country.
Financial wellbeing and mental health are closely connected. When one suffers, the other often follows. For employers and policymakers, understanding this link is critical to building resilient, healthy communities and workplaces.
The Numbers Paint a Clear Picture
Recent studies show a sharp rise in financial stress across Australia:
- The National Mental Health Commission reports that financial stress among Australians has doubled since 2020, rising from 17% to 34.6% in early 2024.
- According to the Australian Bureau of Statistics, one in five Australians (21.5%) experienced a mental disorder in the past 12 months.
- A Beyond Blue survey found that a significant portion of Australians experience distress due to financial issues.
- Among young Australians aged 15–19, more than half (55%) say they are worried about financial security. Those experiencing hardship are twice as likely to struggle with mental health.
- Research commissioned by ASIC confirms a strong two-way relationship: people facing financial hardship are around twice as likely to experience symptoms of anxiety or depression.
The message is clear. Money worries and mental wellbeing are deeply intertwined.
Why Money Stress Affects Mental Health
- Uncertainty and Anxiety When people are unsure how they will pay for rent, groceries or bills, their stress response is constantly activated. Chronic stress leads to anxiety, sleep problems and fatigue.
- A Two-Way Relationship Poor mental health can reduce focus, energy and decision-making ability. This makes budgeting harder, which worsens financial difficulties and fuels further stress.
- Shame and Isolation Money problems often carry stigma. Many people hide their struggles, avoiding conversations or help, which increases loneliness and emotional burden.
- Strain on Relationships and Work Financial pressure often spills into family life and the workplace. It can cause tension at home and distraction, absenteeism or burnout at work.
- Delaying Care People under financial pressure may postpone mental health support because they cannot afford it, which allows conditions to worsen.
The Business Impact
Financial stress is not just a personal issue. It shows up in the workplace through:
- Lower productivity and focus
- Increased absenteeism and presenteeism
- Higher turnover and recruitment costs
- Declines in morale and engagement
A stressed workforce is an expensive one. Supporting employees’ financial wellbeing is therefore both a moral and commercial priority.
A Practical Solution: Earned Wage Access (EWA)
One effective way employers can help is by offering Earned Wage Access (EWA). This allows employees to access part of their earned wages before payday, giving them flexibility to handle unexpected expenses.
How EWA Supports Mental Health:
- Reduces short-term anxiety by helping employees meet urgent costs like rent, food or transport.
- Prevents debt traps, since EWA is not a loan and does not charge interest.
- Improves confidence and control over money management.
- Shows employer support, strengthening trust and loyalty.
Research shows a significant portion of Australian workers experience financial stress between pay cycles. Providing flexible pay can ease that burden and reduce its mental health toll.
Best Practice Tips for Employers
To ensure financial wellbeing programs are effective and ethical:
- Combine EWA with education Offer budgeting and financial literacy sessions to build long-term skills.
- Watch for overuse Frequent EWA use may signal deeper challenges. Pair it with coaching or counselling.
- Protect privacy Ensure employees feel safe accessing support without judgement.
- Integrate mental health resources Link financial tools with Employee Assistance Programs or counselling.
- Track outcomes Monitor engagement, retention and wellbeing metrics to measure impact.
Building a Holistic Approach
True wellbeing at work means supporting both mental and financial health. They are two sides of the same coin. Employers that take this seriously see stronger engagement, lower turnover and a healthier culture.
Earned Wage Access is not a silver bullet, but it is a powerful tool in a broader financial wellness strategy. When employees feel in control of their money, they are more confident, focused and mentally resilient.
Financial wellbeing is mental wellbeing. Supporting one strengthens the other.