The link between financial worries and your mental health

World Mental Health Day was held on 10th October 2023. This annual event helps to raise awareness about mental health issues, encouraging open conversation to reduce the stigma surrounding mental illness, and helping to mobilise efforts to address mental health challenges worldwide.

2 mins

Financial worries can have a significant impact on our mental health, interfering with everyday life and making it a challenge to focus on work or perform daily tasks efficiently.

According to the mental health charity, Mind;

“Poor mental health can make earning and managing money harder. And worrying about money can make your mental health worse. It can start to feel like a vicious cycle.” [1]

Some ways in which financial worries can affect your mental health include:

  • Stress and anxiety:

    Worries about paying bills, meeting financial obligations, or managing debt can be a constant source of stress, leading to persistent anxiety and even panic attacks.

  • Depression:

    On-going financial difficulties can contribute to feelings of sadness and hopelessness, which may lead to depression and affect your ability to function effectively in daily life.

  • Relationship strain:

    Money problems can put a strain on relationships with family members, friends, and partners. Conflicts over finances are a common cause of arguments and can lead to relationship breakdowns.

  • Self-esteem:

    Financial difficulties can erode your self-esteem and self-worth, leading to a decline in your overall self-confidence.

Physical health: The stress associated with financial problems can have physical health consequences, such as increased blood pressure, sleep disturbances, and a weakened immune system. These physical issues can further exacerbate mental health problems.

  • Social isolation:

    Financial difficulties may lead to social withdrawal. Individuals may avoid social activities or gatherings due to embarrassment or the inability to afford them, which can contribute to feelings of loneliness and isolation.

  • Substance abuse:

    Some individuals turn to alcohol or drugs as a coping mechanism to deal with financial stress, which can lead to addiction and worsen mental health.

Recognising the connection between financial matters and your mental health can help you to take steps to manage both more effectively.

Here are some simple steps to help you get back in control:

Create a budget: Establishing a budget can provide a sense of control over your finances, reducing uncertainty, and helping you manage your money more effectively.

Build an emergency fund: Having an emergency fund can provide a financial safety net in times of unexpected expenses or emergencies.

Talk about it: Openly discussing financial concerns with a trusted friend, family member, or therapist can help to alleviate some of the stress associated with money problems.

Practice self-care: Engage in activities that promote mental well-being, such as exercise, mindfulness, and relaxation techniques.

Set realistic financial goals: Break down financial goals into smaller, manageable steps to reduce the sense of overwhelm and help you make progress.

If you, or someone you know, is struggling with financial matters, particularly if it is affecting your mental health, remember that it's essential to reach out for support. Seeking professional help and maintaining open communication with loved ones can be crucial steps in improving both your financial and mental well-being.

Groups such as Mind, Cititzens Advice and debt charity Step Change may be able to provide support or guidance to help you get back on track.

[1] 07/20 | Money and mental health (2020) |

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Succession Financial Management Limited is registered in England at The Apex, Brest Road, Derriford Business Park, Derriford, Plymouth PL6 5FL. Registered Number 04454027.

Please note: This content is for general information only and does not constitute advice. The information is aimed at retail clients only.