World Mental Health Day: Connecting the Dots Between Money & Mental Health

Stock photo

It’s impossible to celebrate World Mental Health Day without acknowledging the close relationship between finances and mental health. At first glance, you may not think that managing your paycheck and your mindset have a lot in common. But when you take a closer look, there are several ways that money directly impacts your mental health. 

1. Financial Stress Impacts Your Ability to Earn Money

When you’re stressed financially, it can manifest as anxiety, depression, or other mental health disorders. And when you’re not feeling yourself, it makes it a lot harder to establish relationships with coworkers and complete your daily work tasks at a high quality. 

You may feel hopeless in your job or that you’ll never make sufficient money to get yourself out of debt or whatever financial struggle you may be dealing with. Plus, studies have shown that financial stress can manifest as physical health issues, like headaches and stomachaches, which also impact your ability to successfully hold down a job. 

2. Mental Health Impacts Make Money Habits Worse

When you’re dealing with financially-induced anxiety and stress, it impacts your ability to manage money effectively. In fact, those experiencing mental health disorders may find it more common to overspend or avoid dealing with stressful financial issues entirely. 

study by the Money and Mental Health Policy Institute found that 72% of survey respondents said mental health problems made their financial situation worse. Pair that with the fact that financial problems dramatically reduce recovery rates for common mental health conditions, and it’s a vicious cycle that many with mental health issues will struggle to break free from. 

But there are simple ways to better manage finances that can relieve the monetary burden associated with mental health issues. 

How to Manage Finances for Better Mental Health

Create a Plan for Debt

Being in debt is one of the most stressful financial situations, and many with mental health issues struggle to ask for help. An easy first step is to simply figure out how much debt you have. Then, choose an approach to pay it off. 

Two of the most popular debt repayment strategies are the debt snowball, which targets your smallest debt first, and the debt avalanche, which begins with the highest interest rate debt first. When you’re feeling the mental health impacts of debt, the debt snowball can often provide the quick motivation you need to keep moving forward. 

Start an Emergency Fund

The purpose of an emergency fund is to lower stress by helping you pay for unanticipated expenses and avoid going into debt to do so. Getting a flat tire or taking a sudden trip to the emergency room is already stressful enough. 

Having an emergency fund in place to replace the tire or pay your deductible means you can deal with the stress of the situation at hand, not the stress of worrying about how to pay for it. 

Find an Accountability Partner

Since overspending is a common symptom of those experiencing mental health issues, sometimes having someone to go to before you make a purchase can help. Consider asking a partner, close friend, or family member to help you manage your spending. 

The person you choose doesn’t need access to your financial situation, especially if there are privacy concerns or shame. They’ll simply serve as a beacon of support if you feel like you’re going to spend recklessly or buy something you may not need. 

The Bottom Line

The line between money and mental health problems is clear. And those suffering from mental health disorders may need more support when it comes to financial management. Taking steps like creating a debt management plan, starting an emergency fund, and finding an accountability partner can help alleviate some financial stressors so those living with mental health disorders can focus on other aspects of wellness. 

Source: Credello