Coronavirus pandemic highlights rising levels of financial stress across Australia
Would you sell your house to keep your staff employed?
That’s what 36-year-old Kate Taylor did to save her business and her sanity.
Her recruitment agency lost 90 per cent of its revenue when COVID-19 hit earlier this year.
It led to a huge amount of work-related and personal financial stress — the worst she’d experienced in her seven years of running the business.
“It’s life-changing — it can make or break you,” she explained.
“When you’re a business owner you feel so responsible for staff, your team and your family — you don’t want to be in a position where you lose everything.”
She had little revenue coming in, wages to pay for four staff and a big mortgage on her Sydney home.
“Very quickly, I had to make decisions in business about how to retain my staff, how to keep my overheads downs. I had to go through my budget,” she said.
“We’ve had to sell our house, downsize all our overheads to keep ourselves afloat.”
Our wellbeing ‘crushed’ by economic impacts
and is a key concern for the National Mental Health Commission.
It means someone’s having difficulty paying for basic things because of a shortage of money.
“I’ve never seen it quite like this before,” said the commission’s CEO, Christine Morgan.
She says financial security is key to our sense of wellbeing, but that’s being crushed by the economic impacts of the pandemic such as losing income or having hours cut.
“We know the primary concern for people is around housing costs and energy costs,” she said.
“That’s not surprising — housing is the security we all need.”
And it’s affecting people of all socioeconomic backgrounds — particularly those with high levels of personal debt.
“Financial stress is a very real stress. And it will impact on your mental health and wellbeing, in all likelihood,” Ms Morgan said.
It can also be a precursor for other general mental health conditions such as anxiety and depression.
“A lot of people don’t do anything about it because they find it too stressful,” said Miriam Jay, a financial counsellor with the Financial Rights Legal Centre.
“Often they’ve let the situation go on for longer, so often the problem is more serious than it might needed to have been.”
Peak body Financial Counselling Australia surveyed its counsellors across the country and found there has been a rise in clients reporting mental health issues this year.
And it expects it to get worse at the end of September, when government supports such as JobKeeper and JobSeeker begin tapering off.
“It’s going to be a big problem very soon,” Ms Jay said.
She’s also worried about the banks’ six-month moratorium on repayments ending.
“I’ve already had two or three people whose support arrangements with the bank have come to an end,” she explained.
“Several still aren’t working, but one of the people, their job is about to get back on track but he’s still very stressed about it.
“I think the first thing they should do is contact the National Debt Helpline. Reach out for some kind of help and don’t let it fester until it’s too late.”
They might help you access hardship arrangements, work with you on a budget to access government support or Centrelink payments, or contact the bank or your other creditors on your behalf.
Learning your lessons and moving on
Kate Taylor is feeling less anxious these days. She sees a psychologist and a business coach and utilises mentors.
“I literally feel like I’ve been on a rollercoaster ride — one minute I’m kicking some goals and the other times I’m thinking, ‘How am I going to get through this?'” she said.
She’s managed to gain some new clients by moving her business into new areas and listening to what potential clients needed during the pandemic.
Having access to government measures like Jobkeeper has also helped.
And selling the house has taken a huge burden off her shoulders and improved her cash flow.
“My anxiety has dropped a lot. I’m not so stressed and anxious. I’m in control again of my choices and my future. That’s the difference, rather than if you wait until it gets to doom and gloom,” she said.
Her advice to others going through financial stress?
Reach out for help.
“Be OK with telling people you’re struggling financially and emotionally. It’s really important to own that and get the help you need. We’ll get through this but we can’t do it alone,” she said.
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