Have you ever felt depressed or anxious because of your financial situation? If you answered “yes”, you are not alone. In fact, a recent MetLife study found that 40% of U.S. employees say having debt or getting into debt is a top contributor to their poor mental health. That’s a lot of people who are emotionally affected by debt.
To learn more about this topic and what you can do to improve your mental health, I spoke with Lindsay Bryan Podvin, a biracial (white Filipino) social worker turned financial therapist, author, speaker, and Michigan’s first financial therapist. Bryan-Podvin’s mission is to help people build a better relationship with money by applying shameless therapy techniques to personal finance.
How is money really related or does it impact mental health?
At first glance, money may appear to be just numbers – as if it’s pretty much about what goes in and what goes out. Many people don’t see at all how this can be related to mental health or emotions. However, the fact is that money has a huge impact on emotional well-being. According to Bryan-Podvin, “There are many reasons individuals choose to work with a financial therapist, but ultimately mental health is at the root of each one. Money and emotions are intertwined. In fact, Behavioral finance experts agree that emotions drive financial decisions 80-90% of the time.”
MetLife 2022 Employee Benefits Trend Survey found that financial concerns were the leading cause of poor mental health among employees. It also found that employees who say they live paycheck to paycheck are much more likely to say they needed to seek help for stress, burnout and depression at work. past 12 months compared to those who haven’t, further reinforcing the strong link between money and mental health.
Steps to improve your relationship with money
Are you doomed to mental health issues due to financial stress? Not necessarily. When asked how people can improve their emotional relationship with money, Bryan-Podvin suggested a three-step approach:
- Understanding your relationship with money: Start by looking back at how money was discussed (or not) while you were growing up. Our experiences with money or lack of it can impact how we think about money for the rest of our lives.
- Take advantage of financial wellness resources: Look for podcasts, blogs, books, and apps that can guide you to financial wellness. Bryan-Podvin recommends starting with an app called To the top.
- Reduce small costs to support big financial goals: Think about the little things you can do now in the present moment that will improve your financial situation.
“If you’re feeling anxious about a big financial decision that hasn’t been made yet, as many people do, try to bring your attention back to the present moment and focus on the things you can control. “, explains Bryan-Podvin. For example, subscriptions are a great place to start. Everyone has forgotten to cancel a subscription after a free trial ends, and those expenses can add up. Scan your bank or credit card statements to find out which subscriptions you’re paying for and which you’re not using. Start taking steps to undo them. If you need help doing that, there are plenty of apps to help you out, like rocket money or To the top. But make sure you’re not cutting costs that impact your overall well-being, like therapy or regular massages for chronic pain.
How to deal with stress related to debt and other financial problems
Of course, even if you work to improve your relationship with money, stressful financial problems will inevitably arise over time. In this case, it is important to learn how to properly manage the stress of debt and other problems.
“First, recognize that it’s common to feel stress when it comes to financial issues. In fact, it happens to most people, no matter what life stage you’re in. When tackling a financial problem like a large debt, it’s important to consider striking a balance between being laser-focused on making progress in paying it off, and recognizing that certain expenses bring value and make you feel better. feel good. It doesn’t have to be an all-or-nothing approach,” says Bryan-Podvin.
To build this balance, try focusing on what Bryan-Podvin calls the “three pillars of personal finance”:
- Know how much money is flowing in and out of your accounts each month, to ensure you have enough money to cover all necessary expenses. This is also known as a “budget” or a “spending plan”, and it’s something that digital apps can help with.
- Always have cash available for short-term needs. Consider an emergency fund you can tap into if you lose your job or have to stay home with a sick child, and other short-term savings goals like saving for a vacation or a new car .
- Finally, be sure to think about the future, which can include investing in retirement, paying off student debt, and setting up a will and trust.
With this framework, individuals can begin to regain control and feel more optimistic about their financial future. And according to Lindsay Bryan-Podvin, “If your financial decisions are driven by peace, excitement, and confidence, you can rest assured that you are likely making financial choices that are good for you both now and in the future. “.