Money And Mental Health: What Is The Impact?
There’s no denying that money is an important part of life. Essential even. But what is the relationship between money and mental health?
Money and mental health
New Zealand surveys its citizens for all sorts of different things, including the amount of stress we are in.
These surveys help the New Zealand government understand the lives of New Zealanders and what services are needed for example.
A survey done by the Commission for Financial Capability (CFFC) revealed that 69% of New Zealanders were worried about money.
This figure was even higher among just women (74%) and within the 18-34 age group (82%).
So Kiwis are clearly stressed about money.
But why does it stress us out so much?
Why does money affect our mental health
As mentioned above, money is essential to living.
So one could say that being stressed about money is just the way it is and can’t be prevented.
But there is more to it than that!
Most of us believe that money is a scarce resource, that there isn’t enough for everyone, so a lot of financial stress comes from the worry of not being able to afford something essential.
There is also the current atmosphere of consumerism that creates pressure to have bigger, better and more expensive things, just like our friends, neighbours, even people we don’t know on social media.
We overextend ourselves when it comes to money, take on debt for things just to keep up with others, then struggle to pay off the debt and afford essentials.
And then just the simple fact of money being such a taboo topic, at home and with friends.
We often struggle alone with money matters, keeping our financial struggles secret from friends, family, even our partners.
This creates more stress, trying to keep up the appearance and our mental health suffers as we try to carry the heavy burden alone.
The shame and guilt of not doing well financially weights down on many of us.
Luckily there are things we can do to reduce financial stress and the toll it takes on our mental health.
How to reduce money stress
The first, and most important important I would argue, thing to do is to work on your money mindset.
Scarcity mindset is one where you believe that money is a scarce resource, that there isn’t enough to go around and that there isn’t anything you can do about it.
The feelings towards money in this mindset are often very negative, and same towards people who do have money.
What you can do is to work towards the abundance mindset, where the belief is that there is plenty of money to go around, and that your own earnings potential is unlimited, only dependant of the effort you put in yourself.
Abundance mindset will give you power to believe that you can earn more money and afford what you need to afford, encourages creativity and resourcefulness whereas scarcity mindset can paralyse you into a belief that you can’t do anything about your situation.
You can find more about how to work on your money mindset in this post.
Once your money mindset is more positive, next thing that will help with financial stress is good money management.
As boring as it sounds, a budget will improve your mental health. It will tell you where your money needs to go and then you get to decide where the rest will go.
A budget and proper money management will give you control over your money, and the feeling of control will reduce financial stress.
In this post you can read about other benefits of budgeting as well, and here is a post about different ways to manage money.
Last, but not least, talking about money will also reduce financial stress, and the feeling of isolation and possibly shame around it.
Problem shared is a problem halved.
Normalising talking about money at home will make it a less emotional topic, so fights about money will also happen less often.
Starting is the hardest part, especially even mentioning it previously hasn’t gone well.
The best place to start is from the financial goals you’d like to reach together with your partner for example, then making a plan to get there.
This way there is a common goal that you’ve decided on together, and the commitment towards it comes naturally, rather than forced or the other half feels that their money habits are being judged.
The main takeaway
Money is a huge part of our life, and often tied with our sense of self worth, so no wonder it can cause stress and mental health troubles.
Luckily there are things you can do to reduce the amount of financial stress you feel, and it doesn’t require making millions!
Working on your relationship with money in general, practicing good money management habits and talking about money in general are small but impactful ways to improve your general wellbeing by minimising stress caused by money.
How do you reduce money related stress? Let’s talk in the comments, I’d love to know!
