How To Cope With Money Stress And Improve Mental Health
Millions of Americans regularly experience financial pressure, especially as the prices of food and other essential goods and services rise. The burden of debt on individuals and families has risen as well, with US consumers now owing over $17 trillion in total debt from credit cards, mortgages, student loans, and other sources. The resulting pressure and stress can have a real impact on a person’s everyday life and can take a significant toll on their mental health and relationships. Here, we’ll explore the effects of money stress on mental and physical health and discuss strategies for coping with financial anxiety.
How does financial stress affect mental health?
Financial stress can be a source of anxiety for many people. The weight of financial pressure can lead to a feeling of overwhelm and can even contribute to depression, an anxiety disorder, or unhealthy coping methods like substance misuse in some cases. A lack of financial health—whether due to rising inflation, significant debt, unemployment, or under-employment—can make it difficult to pay bills, which can lead to food insecurity and concerns about being able to afford rent. In addition to causing anxiety and tension, these major stressors can also affect a person’s self-esteem and have repercussions on their relationships with their family and friends.
How does money stress affect physical health?
Financial stress can also have a significant effect on a person’s physical health. According to Yale Medicine, stress can lead to an increase in adrenaline, which is known as the fight-or-flight hormone. This hormone raises blood pressure and heart rate, which can be helpful during dangerous situations. However, this can become a problem for a person’s cardiac system if it happens too often, as in the case of chronic stress. In this way, chronic money stress can eventually lead to chest pain, an irregular heartbeat, and a greater risk of stroke or heart attack. Financial challenges and worries may also cause trouble sleeping, muscle tension, headaches, gastrointestinal distress, and other common effects of stress.
Statistics on financial stress from the American Psychological Association
Every year, the American Psychological Association (APA) commissions their “Stress in America” survey to get data on the sources and effects of stress for individuals in the United states. In 2024, the survey’s findings suggested that money is a significant stressor for many Americans. It reports that 63% of people say they’re stressed about paying bills or expenses, which can significantly impact daily functioning and well-being.
Addressing money stress with credit card debt services
Individuals who are experiencing money stress may benefit from seeking free financial advice from a reputable source. Several organizations offer free counseling for financial matters. However, it may be important to ask exactly what type of services they offer. Many agencies use terms like “debt relief” or “credit counseling,” but these may mean different things depending on the provider. Some of these agencies will negotiate with creditors to reduce your debt owed, but this can sometimes affect your credit score and may even involve hidden fees. That’s why thoroughly understanding the agreement before signing anything is recommended.
Even if you don’t sign a contract for debt consolidation, some agencies may be able to offer tips on what types of debt you should pay off first to save the most money. You might also be able to receive this type of financial advice for free from reputable nonprofit sources like city agencies or your local library.
Using a budgeting app to help keep money worries in check
Setting a budget and keeping track of your spending may help you feel more in control and less stressed about your finances. Budgeting apps for mobile phones are popular ways to do this today. These apps may help you establish a monthly budget tailored to your needs, and some allow you to easily track spending on your phone. You may also be able to set alerts that let you know when you’re close to your budget limit.
Finding healthy ways to cope with stress
As mentioned, chronic stress can lead to serious mental and physical health complications and decrease your quality of life. That's why it can be important to find healthy ways to cope with stress from any source, including finances. First, it’s generally recommended that you develop healthy routines and habits, which may improve mood and promote resilience. Examples include exercising regularly, getting enough sleep, engaging socially, and taking time for rest when you can. You might also benefit from learning some grounding and mindfulness exercises to help you center yourself when you're feeling overwhelmed by money worries or other stress, like box breathing and progressive muscle relaxation.
Speaking to a therapist about money stress
In addition to speaking with a financial counselor and implementing strategies to manage money and money-related stress more effectively, some people may also benefit from speaking with a mental health professional. A licensed therapist may be able to help people find ways to address money-related stress and move forward with a plan to support their mental health.
Online therapy to reduce money stress and improve mental health
Some people who are experiencing money worries might think that therapy isn’t feasible for them financially. However, online therapy tends to be more affordable than traditional in-person therapy without health insurance, which can lower this barrier for some.
Online therapy allows you to connect with a therapist from the comfort of home, which eliminates the time and money costs of commuting to and from a therapist’s office. Plus, with a platform like BetterHelp, you can get matched with a licensed provider who suits your needs and preferences after filling out a brief questionnaire, which can reduce the time spent and the stress involved in finding the right provider for you. You can also switch therapists at any time, for any reason, and for no additional cost with just a few clicks.
Numerous peer-reviewed studies have indicated that online therapy can be effective for treating symptoms of several different mental health conditions in many cases. For example, in one systematic review and meta-analysis published in 2017, researchers looked at the effectiveness of online cognitive behavioral therapy (CBT). Their findings suggest that online CBT can be effective for treating depression, social anxiety, panic disorder, adjustment disorder, and substance use disorder, among other challenges.
Takeaway
Money concerns can lead to significant stress and poor mental health and may also increase the risk of various mental health conditions. Seeking financial counseling and using a budgeting app may help you gain a stronger sense of control over your finances, and practicing healthy habits and mindfulness exercises could help you cope with stress. You might also find it useful to meet with a mental health professional who can provide specific guidance on addressing mental health challenges and stressors in your life.
How do you mentally deal with credit card debt and financial stress?
Credit card debt can significantly affect a person’s mental health. In addition to implementing practical plans and strategies to reduce debt, you may find it helpful to break down your goals into smaller objectives. For example, rather than thinking about a lump sum to be paid off, you might focus on a goal of paying off a certain amount over the next three months.
It may also help to seek social support from others in similar situations, which you might do by speaking with friends about financial topics or joining a support group. Cultivating healthy habits and engaging and relaxation exercises may help you cope with stress as well.
What does the American Psychological Association say about stress and money?
An annual survey by the American Psychological Association about the sources of stress in America shares statistics about financial stress in the US. For example, in 2024, it shared that 63% of Americans report feeling anxious about paying bills or expenses.
What is money dysphoria?
Money dysphoria is not an official diagnosis in the Diagnostic and Statistical Manual of Mental Disorders, Fifth Edition (DSM-5). Instead, it’s a term that refers to having an unrealistic perspective on one’s financial situation. Someone experiencing money dysphoria might experience anxiety related to a belief that they’re not in a good financial situation despite evidence to the contrary.
Is there free assistance with financial planning?
Many organizations offer free or low-cost help with financial planning. Before agreeing to such services, you might ask if this process involves checking your credit report, as this can affect your credit score. Be sure to ask if there are any hidden fees or obligations before signing a contract with any agency.
What are some ways to reduce money stress?
In addition to seeking financial counseling and implementing money management strategies, you may also find it helpful to use some evidence-based relaxation techniques. For example, during moments of high anxiety, you might consider trying box breathing or progressive muscle relaxation to help you manage stress.
Can you get PTSD from financial stress?
Financial stress in itself may not cause post-traumatic stress disorder. However, traumatic financial situations can cause PTSD. For example, financial loss can happen overnight, and people may experience unexpected expenses, leading to money troubles and difficulty managing debt. Over time, financial problems may lead to homelessness, loss of essential assets, loss of money in many banks, and relationship conflicts. As more events occur, financial stress worsens, sometimes leading to PTSD in some people. Financial stability is often directly tied to one’s survival ability, so having insufficient money for everyday expenses can be highly stressful.
How can you stay calm during financial stress?
Staying calm during financial stress can involve grounding yourself in your present moment and finding emotional support. Breathing exercises and mindfulness may be helpful when you feel stressed, but you can also try talking to someone you love or reaching out to a therapist. Financial stress is a challenge that can be worked on in therapy, and you don’t have to have a mental health condition to ask for support. Your financial health may be directly tied to your mental health and how you respond to stress. A counselor could guide you in your spending habits, financial goals, saving money, reducing spending on impulse purchases, budgeting your monthly expenses, and learning to cope with intense anxiety or stress about money, utility bills, or your bank balance.
How can you heal trauma around money?
If you have trauma surrounding money and financial health, you might consider talking to a trauma therapist or a financial advisor. These professionals can help you learn to save money in your savings account, take advantage of low interest rates, and find healthy ways to cope with your spending habits. Finances can have a significant impact on mental health, so therapists can be a helpful tool for learning to regulate and ground yourself emotionally.
Why do I stress over money so much?
Money often causes stress because it is directly linked to survival and well-being. People can quickly lose their homes, items, and relationships without enough money. Money is the center of US society, and many people work hard to keep a lot of money to keep themselves and their families secure. However, the looming threat of losing money can seem overwhelming, leading people to avoid looking at their bank accounts or talking about money with others. Talking to a therapist about this type of stress may help you move through it.
How do you recover from losing a lot of money?
If you’ve lost a lot of money and it has caused you stress or trauma, you’re not alone. You can start by creating a budget plan, moving forward, and starting anew. If you lose a job, you might start putting your energy into getting a new job or applying for unemployment benefits while you search. You can also lean on your support system for emotional support and potential financial help. Keep an optimistic mindset and continue to work toward your goals, even if you’re grieving what you’ve lost. Talking to a therapist may also be helpful.
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