Student financial problems and mental health concerns are often linked. The Money and Mental Health Policy Institute1 found that financial issues lead to mental health issues related to financial stress.

These mental health issues, in turn, lead to poor decisions that can impact finances. 


According to various studies by the Institute and Student Loan Planner2:

  • Nearly half of individuals with debt also had mental health issues
  • A majority of those with mental health issues (86 percent) say that financial worries make their mental health worse
  • 1 in 15 student loan borrowers has contemplated suicide due to their student loan debt

Students Suffer From Financial Stress

In a 2015 study3, OSU found that 70 percent of students felt stressed about finances, with top stressors including:

  • Paying tuition
  • Paying monthly expenses like rent, utilities, and food
  • Paying back student loans
  • Employment after graduation
  • Working while going to school

Research by the Hope Center for College, Community and Justice4 found that two out of five college students struggle to pay for food and 13 percent are homeless.

These financial woes mean that 73 percent of college students5 work to make ends meet. 

Since the COVID-19 pandemic, the stress has only increased. Core Spaces6 found that not only are students stressed about finances, but the pandemic has created specific economic difficulties for nearly two out of three students. Some of these situations include:

  • Losing a job because campuses were closed
  • Having to pay for rent on an apartment the student was not living in any longer due to closed campuses
  • Losing paid summer internships
  • Inability to get stimulus checks because student were dependents on their parent’s taxes
  • Job market uncertainty after graduation

Student Financial Stress Creates Mental Health Issues 

When students face high levels of stress, mental health issues arise. The Mayo Clinic website7 lists some mental health issues caused by stress:

  • Anxiety
  • Depression
  • Fatigue
  • Sleeplessness

The National College Health Assessment8 adds to this list: hopeless, overwhelmed, mentally exhausted, and sad. These issues cause students to use poor coping strategies such as smoking, drinking, taking drugs, eating poorly, and sleeping too much. When added to stress, these poor habits only make mental health issues worse.

Student Financial Stress Impacts Universities

Student financial stress doesn’t just hurt students. It also hurts the colleges and universities these students attend. For instance, due to financial concerns, college students:

  • Neglect studies (32 percent)9
  • Receive lower grades (34 percent)10
  • Drop a course (34 percent)11
  • Drop out (50 percent of all dropouts)12

These issues affect incoming students since prospective students look at a college’s graduation rates and completion times to determine if they will have appropriate academic support, supportive faculty, and affordability.

Additionally, alumni contributions go down13 among students who struggle financially while in school. 

Financial Wellness Can Help

The Financial Industry Regulatory Authority14 found that financial wellness education for college students helped relieve financial stress, along with the associated poor behaviors.

When financial wellness benefits include games, quizzes, videos, unbiased information, and expert advice, students experience:

  • Higher credit scores
  • Fewer late payments and delinquencies
  • More savings
  • Less debt
  • Fewer compulsive purchases

These outcomes lead to less financial stress and better mental health. Finding a financial wellness program that addresses the needs of your students is critical.



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