As used in American slang the respected and well-established phrase “on the rocks” has taken on a variety of interpretations.
They all relate to some form or another of dilapidation or ruin, however.
Thus a person “on the rocks” may be ruined financially or “busted”; or he may be suffering a physical or mental collapse or “off his hinges,” “minus some buttons,” “gone haywire.”
A marriage “on the rocks” is one that is about to be, or has been, broken up. A business or other venture “on the rocks” has failed or, at least, is in a desperate plight.
Figurative use in the sense of being destitute dates back some two hundred years, and was derived from the literal nautical sense of the condition of a vessel shipwrecked on a rocky coast.