Money and Mental Health

For Mental Health Awareness Week we explore the relationship between money and mental health. If we have money worries it can coincide with poor mental wellbeing. Feeling low can make it tough to manage money and worrying about it can make you feel even worse. We discuss the things to look out for when thinking about money and mental health and how to get back on track if you’ve been feeling down.

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What is mental health?

Being mentally healthy means you can make the most of your potential, cope with the demands of everyday life and play a full part in society. We all have mental health all of the time and we all have periods when we feel sad, happy, stressed, and excited. Mental health is not a linear journey and it’s different for everyone. Thankfully there are now lots of ways to proactively look after your mental health, from apps to courses at work. But what about the link between financial wellbeing and mental health?

Money and mental health 

Mental Health Awareness Week 2020, seems more important than ever. This year the theme focuses on kindness but also tackling rising levels of financial anxiety, especially due to the pandemic. For some, the financial side effects of the pandemic have been immediate, a pay cut or a sudden drop in income. For others, it’s a lingering threat of redundancy or falling behind of payments, the kind of fear that comes naturally when the country is in lockdown. The Mental Health Foundation Charity has stated: “many people with no previous history of mental health problems are at high risk of developing them as a result of having to cope with bereavement, trauma and the sudden and ongoing financial, social and psychological effects of job insecurity and loss of employment.”

When focusing on financial health, it is key to recognise that it’s closely linked to mental wellbeing and they can exacerbate each other. According to Money Advice Service, 55% of all adults have experienced concerns over their mental health or wellbeing because of money worries at some point in their lives.

Identifying the signs of financial worry and knowing the steps you can take to improve your relationship with money, can make you feel more positive and get you back on track.

A diagram that shows how poor mental health means managing money is harder and worrying about money makes mental health worse and vice versa.

How poor mental wellbeing can affect the way you deal with money

Are you unsure if you have poor mental health and whether or not that’s affecting your finances? A good place to start is the NHS, which has a handy page that signposts some of the key things to look out for.  

A few examples of how poor mental health could affect the way you deal with money are:

  • You might spend money you don’t have on things you don’t need to make yourself feel better, but then regret it afterwards 
  • Being in debt might make you feel very anxious – even if you do have enough money 
  • You may find it hard to concentrate on decisions or take in all the detailed information you need to manage your money 
  • You might have a volatile relationship with money 

How to get back on track when you’ve been feeling down

Poor mental wellbeing may mean you make money decisions you didn’t intend to make or you might avoid making them at all. Fixing any damaging decisions you’ve made and protecting yourself from any future decisions is important. Below we’ve highlighted some of the practical things you can do to start.

  • Depending on your spending, you could think about getting rid of credit cards completely, especially if you find them too difficult to manage.
  • If you’ve been feeling overwhelmed getting back in control of your finances by taking small manageable steps can help build your confidence. Consider making a budget for your household spending, analysing what’s coming in and what’s going out. It can help you feel more in control.
  • You then might be able to start thinking about putting money aside in dedicated savings account, for a time when you might not be able to focus on saving.
  • Proactively looking after your mental health, whether it’s meditation, more regular exercising and socialising or seeking more professional help can be a huge step in improving mental wellbeing.

There are a lot of places you can go to get support for your mental health, and acknowledging the link between financial and mental health is important. Even if you have a healthy relationship with money and your mental health now, as stated at the start of this article, mental health is not linear and this can change at any time, so it’s important to be aware of the link.