On the Relation Between Over-Indebtedness and Well-Being: An Analysis of the Mechanisms Influencing Health, Sleep, Life Satisfaction, and Emotional Well-Being.

Mário B Ferreira,Filipa De Almeida,Diego Costa Pinto,Carla Sofia Silva,Márcia Maurer Herter,Jerônimo C Soro

doi:10.3389/fpsyg.2021.591875

Mário B Ferreira, Filipa De Almeida + Show 4 more

Open Access

https://doi.org/10.3389/fpsyg.2021.591875

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Abstract

This paper aims to explore the association between over-indebtedness and two facets of well-being – life satisfaction and emotional well-being. Although prior research has associated over-indebtedness with lower life satisfaction, this study contributes to the extant literature by revealing its effects on emotional well-being, which is a crucial component of well-being that has received less attention. Besides subjective well-being (SWB), reported health, and sleep quality were also assessed. The findings suggest that over-indebted (compared to non-over-indebted) consumers have lower life satisfaction and emotional well-being, as well as poorer (reported) health and sleep quality. Furthermore, over-indebtedness impacts life satisfaction and emotional well-being through different mechanisms. Consumers decreased perceived control accounts for the impact of over-indebtedness on both facets of well-being (as well as on reported health and sleep). Financial well-being (a specific component of life satisfaction), partly mediates the impact of indebtedness status on overall life satisfaction. The current study contributes to research focusing on the relationship between indebtedness, well-being, health, and sleep quality, and provides relevant theoretical and practical implications.

Highlights

Being indebted at certain stages of life may be a means of consumption smoothing across the lifecycle, improving households’ economic welfare (e.g., Hall, 1978; Lombardi et al, 2017)
The following analyses tested for differences between overindebted and non-over-indebted consumers in the measures of interest
Life Satisfaction Using the valid data from 219 participants (104 over-indebted and 115 non-over-indebted), a repeated measures ANCOVA was conducted with Indebtedness Status as a between-participants factor; Time of life satisfaction as a within-participants factor; and the propensity score as a covariate

Summary

Introduction

Being indebted at certain stages of life may be a means of consumption smoothing across the lifecycle, improving households’ economic welfare (e.g., Hall, 1978; Lombardi et al, 2017). Debt becomes most problematic when it leads to over-indebtedness, that is, when it exceeds household resources leading to the inability to meet all payment obligations and to cover living expenses over long time periods. This study seeks to contribute to the extant literature by focusing on the relationship between debt and subjective wellbeing (SWB). We explore how being over-indebted (vs not being over-indebted) affects two different facets of SWB: life satisfaction and emotional well-being. The current study compares over-indebted and non-overindebted consumers on measures of reported health and sleep quality

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