Money & Mental Health: Raising Awareness to Support Financial Wellness
Updated: Jul 11, 2023
The link between finances and mental health
Mental illness and finances are two aspects of life that are deeply intertwined. Mental health is a complex issue that can arise from a combination of genetic, environmental, and biological factors. As July is National Minority Mental Health Awareness Month, it is essential to openly discuss and seek to understand how these two areas are intrinsically linked.
The COVID-19 pandemic unmasked long-standing underlying health disparities that negatively impacted minority communities. However, the impact of mental health on financial well-being and vice versa is a significant issue that affects millions of people globally. In fact, women, Black, Hispanics, LGBTQ, and individuals with disabilities are more likely to suffer from financial stress and lack of savings.
According to the Money and Mental Health Policy Institute, 46 percent of people with debt also have a mental health diagnosis. And 86 percent of people with mental health issues say that their debt worsens those issues. When considering socio-economics, low-income households are more likely to say money negatively impacts their mental health, with 59 percent of those with household incomes of less than $50,000 stating they worry about it. This is an increase of 11 percent from 2022.
The relationship between mental health, stress, and finances is multifaceted. While specific situations may differ, fostering awareness, sensitivity, and empathy is key. Here are a few things to consider when unpacking the interconnectedness of the topic.
1. Financial Stress and Mental Health
Constant worries about money, mounting debts, unemployment, or insufficient income can lead to anxiety, depression, and increased stress levels. The burden of financial responsibilities can be overwhelming, impacting an individual's mental well-being and overall quality of life.
2. Mental Illness and Employment
Mental illness can profoundly affect a person's ability to obtain and maintain employment. Symptoms such as lack of concentration, low motivation, mood swings, or social anxiety can impair job performance and limit career opportunities.
Additionally, unemployment or underemployment resulting from mental health can significantly impact stability and independence. When this happens, employers are also affected by absenteeism, high turnover, increased healthcare costs, frequent on-the-job accidents, less participation in 401(k) benefits, and more.
3. Healthcare Costs and Access to Treatment
Accessing appropriate mental health treatment is crucial for managing it effectively. However, health care often comes with significant financial costs. Expenses related to therapy, medication, and other interventions can further strain an individual's finances, especially if they lack adequate insurance coverage or live in areas with limited mental health. Resources. The financial burden can create barriers to accessing necessary care, potentially exacerbating the issues. An hour-long traditional therapy session can range from $65 to $250 for those without insurance, according to the therapist directory GoodTherapy.org. And a patient with major depression can spend an average of $10,836 a year on treatment costs.
4. Social Isolation and Financial Dependency
Mental health issues can contribute to social isolation, making it challenging for individuals to build and maintain relationships. This isolation can limit their support networks, including monetary support from family or friends, leading to more economic challenges.
So now that you better understand the topic, here are a few things you can do.
1. Financial Education
Financial education can make a significant difference in people's lives by enabling them to take control of spending and saving habits which can alleviate stress and anxiety. You cannot address and improve what you do not know or understand.
The National Bankers Association Foundation has partnered with Our Money Matters to provide a free online financial wellness platform to customers of our member banks, with tools that help with everything from budgeting, saving, managing credit, investing, and career planning. You can discover how your "money personality" affects your spending habits. Using the platform can help users take charge of their finances and life.
2. Talk to a Friend or Loved One
When facing money problems, there's often a strong temptation to completely ignore the situation or keep everything inside and try to go it alone. You may feel shame about your mistakes. But keeping your concerns inside will only exacerbate your financial stress and can also negatively impact your relationships. Your friends and family can't help you if they don't understand the problem.
3. Get Professional Advice
Whether or not you have a friend or loved one to talk to for emotional support, getting practical advice from an expert is always a good idea. Depending on where you live, several organizations offer free counseling and can communicate on your behalf with creditors or help you claim benefits or financial assistance. Support services include How to Get Out of Debt, Unemployment Help, and Getting Help with Living Expenses. Or call 1-844-872-4681. The Financial Planning Association also offers pro bono financial counseling.
It would be best to consider speaking with a minority depository institution or visiting their website. These mission-driven banks often have resources such as articles or other tools like Our Money Matters that aim to help the members of their communities.
Financial instability exacerbates mental health issues, so it's crucial to recognize and address the connection. Individuals can then prioritize adopting sound financial strategies, thereby taking the first step toward a healthier and more stable future.