Combining financial and mental health support works best for tackling poverty

Supporting people with both financial and mental health support at the same time works better than tackling either one in isolation, according to new research led by the London School of Economics and Political Science (LSE).

Researchers noted that poverty and mental health problems often go hand in hand, creating a cycle that is hard to break. Financial stress can lead to depression or anxiety, and poor mental health can make it harder to find work or manage money. Breaking this cycle is essential for improving lives and reducing inequality.

The team reviewed 17 programmes combining psychological and poverty reduction components and found that they were more effective at improving mental health symptoms, psychological wellbeing and, in some cases, socioeconomic outcomes, than those that tackled just one.

Combined approaches tended to outperform psychological components alone but showed mixed additional benefits over poverty‑reduction components alone. This indicates the economic element may drive much of the observed gain.

The review, published in Nature Scientific Reports, analysed combined programmes in both high-income and low-income countries, including the USA, UK, India, and Uganda.

Examples include:

• Cash transfers or help with housing alongside counselling or group therapy.
• Skills training and mentoring combined with psychological support.

People in these combined programmes often had fewer symptoms of depression and anxiety and felt more positive about their lives. Families were more likely to have better food security and higher income, especially when programmes lasted longer.

The research found that programmes worked best when they were well-funded, culturally appropriate, and easy for people to access. Many programmes were too short or lacked resources, which limited their impact.

Mental health and wellbeing gains were more common at short‑term follow‑up, with some persisting into medium and long term. Socioeconomic improvements were more evident at longer follow‑up, suggesting improvements may take longer than mental health changes to materialise but could be sustained once achieved.

How well combined interventions work - and whether they last - depends greatly on context. Factors such as the strength of mental health and social services, social attitudes toward mental illness and poverty, and the surrounding economic and political climate all shape how faithfully interventions are implemented, how engaged participants are, and how broadly findings can be applied.

The report, Poverty-reduction interventions combined with psychological interventions: A systematic literature review, calls on governments, charities, and health organisations to:

• Work together to design programmes that combine financial and mental health support.
• Focus on young people and families, who are most at risk.
• Invest in research to understand what works best in different communities.

Dr Sara Evans-Lacko, of LSE’s Care Policy and Evaluation Centre (CPEC), said: “Our review shows that integrated programmes can improve mental health, but the size and timing of economic support - and the wider context in which it is delivered - often determine the scale and durability of benefit. Designing interventions with robust economic components, alongside targeted psychological support, is essential if we are to translate short‑term symptom gains into longer‑term improvements in people’s lives.”

Dr Evans-Lacko led a global research team, working with 11 academics from King’s College London, University of Exeter, University of Pennsylvania, University of Hong Kong, University of Lausanne and University of Cape Town.