Personal finance: A public health emergency

The UK is currently on track for the worst fall in living standards since records began.¹

While it looks as though the country may be narrowly avoiding a recession, millions are reeling from the cost of living crisis. For the worst off, this meant choosing between heating and eating this winter. The situation was so bad that the government trialled a Warm Home Prescription service where GPs prescribe money off heating bills to help people stay out of hospital.² It’s an awful position to have reached. But let’s focus on what it represents: the inexorable link between personal finance and personal health.

The lower your income, the higher your risk of disease or early death. And that isn’t just looking at the ends of the spectrum. At every level of the economic ladder, people are less healthy than their richer neighbours.³ But the relationship also holds in reverse: the poorer your health, the harder it is to earn well.

With high inflation, stagnant wages, and soaring mortgage costs, right now, almost everyone’s becoming poorer. Which means they’re at risk of becoming less healthy. Which means they’re at risk of becoming poorer. And so on. We need to recognise the current economic situation for what it is: a public health emergency. The good news is that facing up to this reality might actually bring fresh ideas for improving financial wellbeing - and, therefore, overall wellbeing - in the UK.

In this four-part series, we’ll use the analogy of public health as a creative tool: looking to the sector for fresh ideas on improving both individual and institutional financial health. Stay tuned for additional blog articles as we explore the link between personal finance and personal health.

1. Coping with a financial emergency: Lessons from the pandemic
2. Prevention is better than cure
3. Community resilience
4. Pursuing wellness

Now let's dive in.

Using analogy as a creative tool is fairly common practice in the design world. A classic example is James Dyson’s trip to a sawmill: witnessing the cyclone technology used to remove sawdust from the air inspired the creation of the first bagless vacuum cleaner. But it works for the design of services as well as products. At Great Ormond Street Hospital in London, a surgical team was able to improve post-operative patient handovers with inspiration from Formula 1 pitstop crews. The doctors identified the similarities of their high-pressure, highly technical environments and set out to observe the strategies used by the crews to keep handover times down and mistakes non-existent. They quickly spotted ideas they could adopt in their own theatres: an independent ‘conductor’, better scenario planning, and a rule of silence.⁴

Given that the link between financial and physical/mental health is not just abstract, it’s a reality, it makes even more sense to look for potential solutions in public health. You can ask questions like: how might the behavioural strategies used to keep citizens physically safe during the pandemic be leveraged to keep customers financially safe in the current economic climate?

Or: how might you apply the axiom ‘prevention is better than cure’ to the concept of financial wellbeing? Or: how might you apply the approach of social prescribing to financial services?⁵ If the NHS recognises that advice on managing finances might help someone improve their health status, then shouldn’t the financial services recognise that advice on physical or mental health might help someone improve their financial status?

Financial wellbeing is good for business. Customers with strong financial health can both make better use of their existing products (e.g. balancing income and debt more effectively) and can better understand the benefits and risks associated with new products. This means they’re more likely to take on new products that are right for them, and less likely to be scammed. On top of this, well-designed initiatives that help build financial wellbeing will inevitably have a positive reputational impact on the firms that trial them.

The analogy of public health offers up a wealth of ideas for tackling financial health, just some of which we’ll dig into in this series of articles. It’s ideas like these, combined with the might of the financial services industry to implement them, that can help get the UK’s living standards back on an upward trend.

In conjunction with this article series, we’ll be running workshops connecting people in industries like finance, healthcare, politics, design and beyond to expand on the emerging ideas and find opportunities to bring them to life. No matter what your role, we’d love to get you involved - please reach out to [email protected] if you’re interested.

References

1. Milliken, D. (2023). ‘UK still faces record hit to living standards, OBR predicts’, Reuters, 15 March. Available at: https://www.reuters.com/world/uk/uk-still-faces-record-hit-living-standards-obr-predicts-2023-03-15/
2. Bancroft, H. (2022). ‘Patients prescribed warm homes in NHS winter pilot that pays energy bills’. Available at: https://www.independent.co.uk/news/health/nhs-cost-of-living-energy-bills-winter-b2229848.html
3. ‘How are Income and Wealth Linked to Health and Longevity?’, Urban Institute & the Centre on Society and Health, 2015. Available at: https://www.urban.org/sites/default/files/publication/49116/2000178-How-are-Income-and-Wealth-Linked-to-Health-and-Longevity.pdf
4. 'A Hospital Races To Learn Lessons Of Ferrari Pit Stop', Wall Street Journal, 6 Nov 2006. Available at: https://www.wsj.com/articles/S...
5. https://www.england.nhs.uk/personalisedcare/social-prescribing/