Embedding Financial Wellbeing into National Policy

Mental Health Awareness Week is a timely moment to reflect on the growing recognition of financial wellbeing in the UK. Financial health is increasingly acknowledged as one of the cornerstones of overall wellbeing, influencing not only one’s ability to manage day-to-day-living but also one’s mental and physical health.

Whilst financial wellbeing is starting to receive the attention it needs, there is still a real opportunity for policymakers to take it further. By tying it more closely to health and economic policies, there is room to create a more joined up approach that helps people feel more secure and supports the wider economy at the same time.

Interplay between financial wellbeing and mental health

As the nation continues to navigate a cost-of-living crisis, the link between financial stress and mental health has become increasingly clear. In England alone, over 1.5 million people are experiencing both problem debt and mental health difficulties. Financial strain is widely recognised as a key driver of anxiety, alongside acknowledgement that mental health challenges can make it harder for individuals to engage with essential financial services, such as banking. The link between money worries and mental health is intensified by ongoing price rises, leaving many with reduced financial security and rising psychological strain – threatening the Government’s ambition to improve the nation’s health and wellbeing.

Integrating financial wellbeing into health and financial services policies presents an opportunity to improve individual wellbeing and drive forward economic growth. When individuals experience financial security, they are not only healthier and less stressed, but they are also more economically active. With the capacity to spend, save and invest confidently, individuals stimulate demand, support business growth and contribute to job creation. This, in turn, directly advances Labour’s core mission of securing sustained economic growth.

Improving quality of life

Prime Minister Keir Starmer has made it clear that “growth in the abstract doesn’t mean the same as people feeling they’re better off”, signalling a shift towards policies that aim to improve quality of life across the UK. This approach makes room to tie financial wellbeing to public health, recognising that financial stability is essential for stronger, healthier communities.

Whilst the Government is making strides to embed financial wellbeing into national policy, including increasing the National Living Wage and advancing financial inclusion, this needs to be matched by what happens on the ground. The NHS recognises the impact of money worries on wellbeing and has partnered with the MoneyHelper Service to provide free resources, such as budget planners and support lines. However, current support still falls short of what is needed to truly prevent financial stress from turning into health problems. It could do more to reflect the Government’s shift to prevention and productivity, as well as encouraging a greater link between health and financial services policy.

Supporting economic growth

Financial wellbeing is also a key driver of workplace productivity. Employees who are not burdened by financial distress are more focused, less likely to be absent and more engaged in their work. This leads to improved performance and efficiency across sectors, boosting output and enhancing the UK’s economic competitiveness.

From a fiscal perspective, early interventions to promote financial resilience can also ease long-term pressures on public services. Reducing financial insecurity helps lower the incidence of mental health challenges and dependency on social support systems, enabling a smarter, preventative approach that benefits individuals, employers, and the state alike.

By embedding financial wellbeing into policy frameworks, policymakers can begin to foster a healthier population and a more robust economy – one that is better equipped to weather future shocks.

Conclusion

This Mental health awareness week, it’s clear this must remain a year-round policy priority. Financial wellbeing is not just a personal matter, but one that underpins public health, productivity, and economic growth.

The Government has taken steps, but a more joined-up approach is needed to reflect its focus on prevention and long-term resilience. This means embedding financial wellbeing across health and economic policy, and ensuring services match that ambition.