Yes, Financial Stress Can Impact Your Mental Health — Here's How to Cope with Money Anxiety

Your biweekly paycheck doesn’t come until next week, but your credit card debt has been racking up from the few unexpected trips you had to take this year to visit family or hop on a plane for a friend’s wedding. Or maybe you were laid off recently, still haven’t landed a new job yet, and have young children to take care of.

With thousands of layoffs and the remnants of inflated prices affecting people in a very real way, some people might have hit a financial rough patch these past couple of years since the COVID-19 pandemic started. Others seem to be caught in a longer, more constant spiral of financial stress, that is impacting their mental health in the long run.

For some, not only just living in poverty, but having debt hanging over their head, or any other kind of financial stress, tends to the be number one stressor people report; it can exacerbate psychological distress, which includes anxiety, insomnia, depression, and the list goes on, according to research published in 2023.

But ultimately why does money have the ability to affect people in such a way, and impact their mental health? Find out more from resident financial and mental wellness expert Dr. Regine Muradian, PsyD, clinical psychologist and National Debt Relief Financial Wellness Board member, and keep on scrolling for how to cope with mental health issues that stem from financial stress.

How money issues can impact your mental health

It can make you feel inadequate as a person.

Having less than enough money can contribute to a feeling of, well, not being enough as a person. Feelings of inadequacy may creep in if you aren’t able to provide for your family, or if you just feel like you let yourself down on a personal level with your finances. “I didn’t budget properly, spend properly, [might be thoughts you have], and you go into this cycle,” says Muradian.

You may feel a loss of control over your life.

A lot of anxiety stems from feeling uncertain or that you’re out of control of your present or future. “Feeling a loss of control —how am I going to make ends meet— exacerbates the feelings of inadequacy,” says Muradian. The thoughts and worries about the future, as in keeping your home, paying your rent, and taking care of bills, can add to the intensity of the money anxiety.

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