True Link blog

Financial challenges of addiction and substance use disorder: hard truths and real consequences

Published by:
Erin McInrue Savage
December 4, 2018

Trying to hold his life together, Billy admits he started “pulling mad loans, refinancing and selling my assets, my cars, and refinancing my home.” He even lost the business he had built. Finally, Billy hit rock bottom.

Virgil admitted that when he was using, “I’d do anything. I knew my finances were already bad. I didn’t care if it got worse…. I would do anything I could. I took credit cards, overdraw my balance, take out a payday loan. I wrote checks to myself from an old checkbook, and deposited it to my account so I could take out money at an ATM.”

Working with recovery programs and people in recovery across America, we kept hearing stories like Billy’s and Virgil’s, stories of financial struggles during the course of their addiction.

To better understand the magnitude of the problem, True Link tried to find the latest data: What is the most common financial impact of substance use disorder (SUD)? What financial challenges slow down recovery? How often do financial metrics – like having a bank account, owing significant debt, or being able to access credit – improve over the course of recovery?

For answers, we turned to government data sources, academic publications, banking and financial services reports, recovery industry publications, and more. Yet, through all that research, we found very little that looked at financial outcomes at any point in recovery.

In fact, there wasn’t much at all, aside from a few mentions of employment status and a study from several years ago comparing how successful people in long-term vs. early stages of recovery are at challenges like paying back taxes or paying back personal debt.

But we know that people affected by an SUD, both those who are actively using as well as those on the long road to recovery, face significant financial challenges. In fact, a dissertation examining the range of experiences of young adults in recovery states,

Their worries and concerns relating to money pervaded the interviews.This is the reality for many of those in recovery who may not have learned the skills necessary for financial independence because that task could not be accomplished during active addiction.”

Since True Link works to provide better financial tools to people in recovery, we need to deeply understand our customers’ experiences, including the complex relationship between money and SUDs. To get a sense of the magnitude of the problem, True Link has conducted a national survey on finances and substance use disorder.

With a nationally representative sample of adults across America, we learned that 82% of people who have a loved one with an SUD say that their family member experienced adverse financial effects due to their addiction, specifically:

  • 48% reported their loved drained savings or retirement accounts
  • 42% said their loved one sold assets to gain access to cash and
  • 11% said their loved one filed for bankruptcy

For the full range of responses and for the complete study, Financial Wellness in Addiction and Recovery: Hard Truths and Real Consequences, click here.

A note on our methodology:

Based on our research, this is among the first studies of its kind. We certainly hope it’s not the last. We hope to inspire more research to better understand the financial challenges faced by people during the active use phase of their SUD, as well as during their recovery. While you read our study, keep these considerations in mind:

  • While our sample isn’t as large as a national government survey, it is among the first national samples that focuses exclusively on the financial challenges people face in addiction and recovery. We surveyed 341 people in total and our results focus on data from 149 respondents who have a loved one with a substance use disorder.
  • We often hear it said that “addiction is a family disease.” That’s why we believe our choice of seeking responses from family member informants as a proxy for this population is appropriate. Though a close family member or friend may not know the full extent of someone’s financial circumstances, many have seen financial consequences their loved one faced during addiction and recovery. That said, there are other financial effects of people’s addiction that are neither studied nor commented on here. There is much to learn about the intersection of financial wellness during the course of someone’s addiction and during their recovery. We are committed to learning more about the financial needs of people who are overcoming an addiction and how to help them navigate their complex situations and unique financial needs in recovery.
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