Due to the nation’s current economic climate, many people are experiencing increased stress over their financial situation. The state of our finances has an undeniable impact on our overall well-being. Mental health and financial health are two important aspects of our lives that are intertwined.
How We Feel About Our Financial Situation
According to a CNBC survey from earlier this year,
74% of Americans say they are stressed about their finances, with 37% describing themselves as “very stressed”
61% say inflation contributes to their financial stress
61% consider themselves to be “living paycheck to paycheck”
According to another recent study, ongoing inflation, the potential of a recession and debt management are top concerns of adults. What’s more, 70% of adults report being in debt, with 42% citing credit card debt as the primary cause.
According to a recent Bank of America survey, 85% of Gen Z’s cite one or more barriers to achieving financial success. Of this percent:
53% report a higher cost of living as the primary barrier
36% report not having enough income to achieve financial goals
34% report the economy as the cause
30% report housing costs as a barrier to financial success
Plus, according to a report by the Federal Reserve, about 28% of non-retired adults have zero retirement savings—up from 25% in 2021.
Ways Financial Concerns Can Affect Mental Health
Money problems can significantly impact an individual's mental health in numerous ways. They can:
Trigger anxiety and panic
Cause sleep problems
Restrict access to essentials like housing, food and medical care
Strain social life and relationships, leading to loneliness and isolation
For individuals who are already dealing with mental health issues, the struggle can be even more pronounced. This group may find themselves overspending for various reasons, such as attempting to seek momentary relief, succumbing to impulsive financial decisions due to mood fluctuations or grappling with addiction or dependency issues.
Fortunately, there is hope. Working with a therapist can offer a lifeline for those facing the complex interplay of financial and mental health challenges.
A therapist may delve into crucial topics, such as the psychological impact of money, the sources of financial stress, spending and saving behaviors, and the emotional aspects of financial decisions. By exploring these areas, individuals can work toward better mental and financial health.