The impact of health on savings and income

Being in problem debt can harm people’s physical and mental health by causing strain and stress, reducing income available for products and services that promote good health, or increasing health-harming coping behaviours. Poor health can also increase the possibility of problem debt, for example when someone loses their job or has a low income. This can create a cycle of problem debt and poor health. 

This chart shows the proportion of people with no savings by income and health in 2018-20. 

• Overall, half (50%) of people with poor health have no savings compared to just over a third (35%) with good health. This is partly due to people with poor health being more likely to have a lower household income, but not exclusively. At almost every level of income, people with good health are more likely to have at least some savings.
• In the bottom tenth of incomes, 77% of people with poor health have no savings compared to 66% with good health.
• In the top tenth of incomes, 23% of people with poor health have no savings compared to 18% with good health.
• The inequality in savings between people with good health and people with poor health is larger in the bottom tenth of incomes than in the top tenth.  

There are several potential explanations for this relationship. One is that people with poor health are more likely to be out of work, and consequently have lower incomes. They may also face higher costs as a result of their poor health, such as higher heating bills or home adaptation costs, leaving them with less remaining income to save.