Your Mental Health & Money

Money can be stressful, particularly if there’s not enough of it. Everything from debt to investment losses to not having enough saved for retirement can cause feelings of stress and anxiety that have a drastic, negative affect on your mental health.

The bigger your financial distress, the bigger its impact on your mental well-being.

Depression and debt

Coming as a surprise to absolutely no one, depression and debt can be strongly linked. Short-term debts like overdue bills, credit cards, and living in overdraft are most strongly associated with depressive symptoms. If you’re anxious about being able to pay your electric bill or have gotten to the point where you’re not even opening your credit card or loan statements, you already know how anxious the words “balance owing” can make a person.

Worrying about money makes your money worries worse

One of the worst aspects of dealing with financial stress, is frequently our coping mechanisms will further add to our problems. Many people dull the pain of debt by shopping, further increasing their debt load. Others figure since they’ll never be able to pay off their massive loan balances, there’s no point in making any payments towards them, and ruin their credit by missing payments and sending their debts into collections.

Constant worry about your finances isn’t healthy, but apathy isn’t either. You need to find the right amount of concern and care to help you cope with your financial situation (and everything else).

Taking care of your mental health can help you take care of your money

Reducing stress and anxiety in your everyday life will help you manage your money better. This isn’t merely wishful thinking. Research indicates that stress and worry about finances can negatively impact your cognitive abilities equivalent to the loss of two IQ points. The reverse is also true: if you can reduce stress and anxiety in your life, you’ll be more clearheaded which will help you earn more money and better manage your finances.

Tips for dealing with anxiety, stress, and depression and money

Don’t look at your balances unless you’re making a payment. If you owe money, you might find yourself starting at the amount for hours on end. I have no idea why we do this; I only knew that when I had debt, I insisted on staring at it 24/7, wishing the balance away. Continuously reviewing your bank balances won’t make them change, but it will leave you distracted, anxious, and worried. Unless you’re doing something that requires you to review your balances, DON’T log-in to your online banking to stare at your balances owing. It never does anything good.

Work with your creditors, not against them. Your lenders want you to pay them, and while might think this is exactly what’s causing you so much anxiety in the first place, remember you can also use it to your advantage. If you’re in danger of missing a payment or defaulting on a loan, contact your creditor and let them know. Then ask if there’s anything that can be done to avoid the debt going “bad” and falling into collections. Most creditors will be willing to work with you in different ways, from extending your payment due date to adjusting the terms of your loan to make it more affordable. Remember, they don’t want your debt to go into collections either. Protect your credit score by calling your lenders and negotiating with them before you experience extreme financial distress, not after!

Make a plan to put out the smallest fires first. Often it’s the sheer volume of financial responsibilities that can cause feelings of stress and anxiety. If you’re juggling too many debts or trying to tackle too many financial tasks at once, one of the kindest things you can do for yourself is get rid of the smallest items nagging at you for no other reason than to get if off your list. This could mean anything from canceling a subscription service you don’t use anymore, to paying off a small credit card, so you don’t have to get a bill anymore. Sometimes a really small action can have a huge payoff.

Counseling or therapy is never a waste of money. The cost of care or support for mental health challenges is expensive, but it’s almost always money well-spent. Avoiding getting the support you need because of the cost will only serve to increase the risk of a larger expense later, such as needing to take leave from work. For this reason, you should treat any mental health services you need and have to pay for as equal importance to keeping a roof over your head or buying food. Trust me; you can afford to pause your retirement savings contributions for six months if you use the money for the resources you need to get through a hard time.

Make your mental health a priority. If professional counseling is not an investment you need to make, but you still need to find ways to reduce your everyday stress, make it a priority to do so – and DO THE THINGS you need to. Some of the best things you can do to for your well-being is eat nutritiously, workout regularly, get enough sleep, meditate, and spend time with friends and family. The best part? All of those things are free.

Know the absolute worst is not that bad. This might sound crazy, but the fact of the matter is even if you find yourself broke or bankrupt, you wouldn’t be the first. And it wouldn’t mean you cannot ever recover. We tend to over-dramatize the “worst case scenario” only to find ourselves more than capable of surviving (and thriving) once we’re in the thick of it. I’m not saying get comfortable in overdraft or missing a payment on your credit card, but do acknowledge that if these things happen, they sky won’t fall in. If you need further reassurance, I highly recommend James Altucher, who’s gone from millionaire to bankrupt and divorced, twice. You might enjoy his post, What To Do When You Lose Everything.

As tough as it can be to convince yourself, your health is more important than your bank account. Make sure you put it first.