Australia’s current economic conditions of high inflation, rising cash rate and soaring housing costs have been linked to poor mental health outcomes such as psychological distress, anxiety and depression.

What is financial stress?

Financial stress refers to households struggling to meet financial commitments and having limited financial resources. Examples include struggling to cope with rising mortgage payments and higher food and energy prices. It can lead to health concerns such as an increased heart rate and blood pressure, difficulty sleeping, fatigue, irritability, difficulty concentrating, and feeling hopeless or helpless.

Financial stress can impact relationships, physical and mental health. Individuals dealing with financial stress may engage in behaviours such as arguing with others about money, withdrawing from social situations, and delaying needed health care due to cost.

Key statistics of financial stress

The Household Income Labour and Dynamics survey in Australia found that from 2022 to 2023, the overall financial stress level rose from 11 per cent to 13 per cent. Certain groups, such as the unemployed, single parents and renters, are more prone to experiencing significant financial stress. 

In 2023, a Beyond Blue survey of more than 5,000 people found that one in three reported that cost-of-living pressures had negatively impacted their mental health either “quite a bit” or “an extreme amount” over the previous 12 months.

Lifeline had 26,000 searches for assistance, its highest amount recorded, with referral searches by helpline counsellors relating specifically to financial issues and homelessness increased to 49 per cent between August 2022 and January 2023. 

It has never been more crucial to understand the association between financial stress and mental health outcomes and to improve your well-being in these conditions. 

What are the current gaps in mental health services in Australia?

There is a wide gap between the number of people who need psychological care and those who actually receive it. A recent study suggests that roughly 4.3 million Australians aged between 16 and 85-years-old experience mental illness each year, but only half of these people receive care.

This gap is driven by the accessibility and affordability of mental health support in Australia.

The average cost of a therapy session in Australia can range from $100 to over $300, depending on the type of service and the provider. This leaves people struggling with the cost of living unable to afford the necessary assistance.

At the Mental Health Foundation Australia, we support everyone no matter their financial situation. We bridge the mental health service gap by offering affordable $30 counselling sessions at our Wellness Hub. We believe accessible mental health support should not be a luxury and that we all deserve help when needed. If you are unable to afford these sessions, the fee is then waived.

Cost-effective ways to support your mental health

Nature Therapy

Going outside and spending time in nature is scientifically proven to boost mental health. After only 10 to 15 minutes outdoors, the stress hormone cortisol can be measurably lowered. Taking your morning coffee outside or going for a walk on your lunch break can positively improve your sleep, limit ruminating thoughts, and help you focus.

Downloading a budgeting app

There are many free budgeting apps available to users. These resources can help raise financial awareness and help identify unnecessary spending.

Journaling

Putting your thoughts down on paper is a low-cost way to reduce stress and anxiety levels, relieve your mental load, and regulate your emotions.

Meditation

Meditating is another way to reduce your stress hormone cortisol. This method helps calm your nervous system and helps you feel grounded amid financial anxiety.

If you are experiencing financial anxiety, or facing mental health challenges, our counsellors offer a safe space for you to share your concerns and ensure you receive support. To book an appointment, visit our website: https://wellnesshub.mhfa.org.au/book-an-appointment

REFERENCES:

• Financial stress and mental health - Mental health. (2025, December 2). Australian Institute of Health and Welfare. https://www.aihw.gov.au/mental-health/topic-areas/other-mental-health-reports/financial-stress
• ‌Unravelling the psychological impact of financial stress in a cost-of-living crisis | APS. (2025). Psychology.Org.Au. https://psychology.org.au/for-members/publications/inpsych/2023/spring-2023/unravelling-the-psychological-impact
• ‌Financial stress and your health. (2025, July 3). Healthdirect.Gov.Au; Healthdirect Australia. https://www.healthdirect.gov.au/financial-stress#cause
• ‌Prevalence and impact of mental illness - Mental health. (2025, May 20). Australian Institute of Health and Welfare. https://www.aihw.gov.au/mental-health/overview/prevalence-and-impact-of-mental-illness
• ‌Therapy Costs - Psychotherapy and Counselling Federation of Australia. (2021). Pacfa.Org.Au. https://pacfa.org.au/portal/portal/Community/Therapy-Costs.aspx

 Blog Written by: Bianca Joncevski & Olivia Pase, Media Interns