Ep. 159 - MODERN MONEY MATTERS - HOW FINANCES SHAPE MENTAL HEALTH
MARIE-JO:
Greetings and a warm welcome to another insightful episode of the Merging Life and Money Show. I am your host, Marie-Jo Caesar, a holistic financial wellness strategist. My mission is to help clients take control of their money from the inside out, addressing both the emotional and the practical sides of money.
Money and mental health are deeply intertwined, and today, we will discuss how financial stress impacts our well-being. In this episode, we will explore the significant role that financial wellness plays in mental health and how we can improve our financial coping skills. As we navigate through Mental Health Awareness Month, the theme Learn, Act, Advocate perfectly aligns with our discussion today.
We will Learn about the connection between finances and mental health, Act by building a financial coping toolbox, and Advocate for better financial and mental health.
Welcome to the Merging Life in Money show.
In this episode, we will discuss how financial stress can lead to anxiety, depression, and other mental health issues.
We will explore financial wellness as a form of self-care and address the unique financial challenges of modern life. We will also provide actionable strategies to build financial resilience and encourage open conversations about money and mental health.
So whether you are a financial whiz or just starting your financial wellness journey, this episode is designed to provide Valuable insight.
Let me start by sharing relevant statistics to further establish the significance. of our topic today. According to a recent survey, nearly 60 % of Americans report feeling anxious about their financial situation, with over 30 % stating that financial stress has impacted their mental health. This makes financial stress one of the leading causes of anxiety, depression, and other mental health issues.
The fact is that financial pressures can greatly impact our well-being, making it vital to understand and address this connection.
By openly and honestly discussing financial wellness as a key component of mental health, we can begin to break down the stigma around money-related stress and anxiety and help people realize that they are not alone in their struggles.
It is important to know that financial wellness encompasses our ability to manage money and how we feel about our financial situation. Understanding this link can empower us to take control of our finances, improve our mental health, and ultimately live a more fulfilling life. Let's move on to today's episode's first point. Learn. Understanding the link between money and mental health. Financial stress is a common experience that can significantly impact our mental health. When we face financial struggles, whether it is due to unexpected expenses, mounting debt, or a sudden loss of income, it can trigger a range of negative emotions, including anxiety, fear, and shame.
Over time, this emotion can escalate and lead to more serious mental health issues such as depression and anxiety disorders. For example, imagine living paycheck to paycheck, constantly worrying about how to cover your bills. This constant worry can evolve into chronic stress, leading to sleepless nights, difficulty concentrating, physical symptoms like headaches and fatigue, and even impacting your daily lives and relationships. Financial stress can also lead to feelings of hopelessness and despair, which are common symptoms of depression. In more extreme cases, the weight of financial burdens can lead to harmful behaviors.
To illustrate this further, consider a family struggling to pay their bills. The parents may become irritable or withdrawn due to their financial worries affecting their relationship with their children. Similarly, young adults burdened with student loan debt may feel overwhelmed and anxious about their future prospects, leading to a decline in their overall well-being.
These examples highlight the importance of addressing financial stress to maintain mental health. When we understand how financial struggles impact our well-being, we can begin to take proactive steps to manage this stress, protect our mental health, cultivate a sense of financial wellness, and improve our quality of life.
Next, I will explore how maintaining financial health contributes to our overall well-being. Taking care of our finances is an essential aspect of self-care that is often overlooked. Just as we focus on our physical health through exercise and nutrition or our mental health through mindfulness and therapy, we should also pay attention to our financial health as an important part of our overall well-being.
Let me say that financial wellness is not just about having a large bank balance or being debt-free. It's about feeling confident and secure in our financial situation, clearly understanding our financial goals, and taking proactive steps to achieve them.
Maintaining financial health involves managing our money to align with our goals and values. When our finances are in order, we experience less stress and greater peace of mind, which positively impacts our mental and emotional well-being. On the other hand, neglecting our financial health can lead to feelings of anxiety, insecurity, and even hopelessness.
So, how can we practice financial self-care? Here are a few tips.
One, regularly review your finances. Set aside time each month to review your income, expenses, savings, and debts. This will help you stay on top of your financial situation and make adjustments as needed.
Two, set financial goals. Whether it's saving for a vacation, paying off a loan, or building an emergency fund, setting clear goals can give you a sense of direction and purpose.
Three, create a budget. A budget is a powerful tool for managing your money. By setting limits and prioritizing your spending, you can avoid unnecessary financial stress.
Four, save and invest. Saving money, even a small amount, can provide a sense of security and prepare you for unexpected expenses. Building an emergency fund can be particularly helpful. in times of crisis. As a result, I will urge you to make saving and investing a regular part of your financial routine.
Five, manage debt. Taking control of your debt through repayment plans or consolidation can relieve significant financial stress. Developing a strategy to manage and reduce debt can empower and benefit your mental health.
Six, plan for the future. Setting financial goals and planning for the future, such as saving for retirement or a major purchase, can give you a sense of purpose and direction. This planning can also motivate you to make positive financial decisions in the present.
Seven, seek financial advice. Consulting with a financial professional can provide valuable insights and strategies for managing your finances. Professional guidance can help you make informed decisions and feel more confident. in your financial situation.
Financial wellness is a journey, not a destination. When you incorporate these practices into your life, you can enhance your financial well-being and, in turn, improve your overall mental health. Remember, financial wellness is a form of self-care that allows us to thrive emotionally and financially.
Next, I want to address the unique financial challenges of modern life.
In today's fast-paced world, we face a variety of unique financial challenges that can impact our mental health. Rapid technological changes and the evolving economy have introduced new pressures and uncertainties that affect our financial well-being.
One of the key challenges of modern life is the increased cost of living, especially in urban areas. Housing, health care, and education costs have risen significantly, making it difficult for many individuals and families to survive. This financial strain can lead to anxiety and stress, especially for those who are trying to balance these expenses with other financial goals.
The gig economy and the rise of freelance work have also changed the financial landscape. While these opportunities offer flexibility, they often come with income instability and a lack of traditional benefits. like health care and retirement savings. This uncertainty can create financial stress and impact mental health as many struggle with unpredictable income and a lack of financial security.
Technology has also introduced new financial challenges, such as the ease of online shopping and the prevalence of digital payment methods, such as mobile payment apps. While these conveniences have their benefits, they can lead to impulse spending, increased debt, and difficulty managing finances, which can contribute to financial stress and impact mental well-being. Additionally, the increasing complexity of financial products and services can be quite overwhelming. With so many options available, individuals may feel unsure or anxious about making the right financial decisions. This uncertainty can lead to decision fatigue and impact mental health, especially when financial mistakes result in negative consequences.
To address these challenges, it is important to be proactive in managing our finances and seek support when needed by staying informed, setting financial goals, and building financial resilience so we can navigate the unique challenges of modern life and protect our mental well-being.
I will end this point and say that we can protect our financial and mental well-being by understanding the changing financial landscape and developing effective strategies to manage our money.
Now that we've explored the link between finances and mental health let's address the second point of today's episode and shift our focus to taking action and building a financial coping toolbox.
Budgeting and planning are the most effective ways to manage financial stress. Creating a budget is so important for understanding and controlling our finances, which helps reduce stress and improve our overall well-being.
A budget allows us to track our income and expenses, make informed spending decisions, and save for our financial goals. This clarity helps us feel more in control of our finances, alleviating anxiety and promoting peace of mind.
Here are some tips for creating an effective budgeting plan.
Set clear goals. Before creating a budget, it is important to set clear financial goals. These goals can include saving for an emergency fund, paying off debts, or saving for a major purchase. Clear goals help guide our budgeting decisions and give us a sense of purpose.
Two, tracking common expenses to create a budget. Start by tracking your income and expenses for a month. This tracking will give you a clear picture of your financial situation and help you identify areas where you can cut back and save.
Three, categorized expenses. Divide your expenses into categories such as housing, utilities, groceries, and entertainment. This categorization will help you see where you are spending the most and identify areas where you can make adjustments.
Four, prioritize needs and wants. When creating a budget, prioritize essential expenses, such as housing and utilities, before allocating money to non-essential items. This prioritization helps meet our basic needs and prevents unnecessary financial stress.
Five, review and adjust. A budget is not set in stone. Review your budget regularly and adjust it as needed to reflect changes in income and expenses. This flexibility ensures that your budget remains relevant and effective.
Six, use budgeting tools. Many budgeting tools and apps can help you track your income and expenses, set financial goals, and stick to your budget.
Remember, a budget is not a restriction but a tool for financial empowerment. By taking control of our money, we can reduce financial stress, improve our financial well-being, and achieve our financial goals.
Now, let's talk about building financial resilience.
Building financial resilience is an important aspect of creating a financial coping toolbox. Financial resilience refers to our ability to withstand and recover from unexpected financial setbacks, such as sudden expenses, loss of income, or economic downturns. Building financial resilience can protect our mental health and maintain stability during challenging times.
Here are some strategies for building financial resilience.
One, create an emergency fund. The emergency fund is a savings account that you can use to cover unexpected expenses such as car repair, medical bills, and job loss. Aim to save at least three to six months’ worth of living expenses in your emergency fund.
Two, manage your debt. High debt levels can make handling unexpected expenses quite difficult. Make a plan to pay off your debts, starting with the ones with the highest interest rates. If you are struggling with debt, consider seeking help from a financial professional or a credit counselor.
Three, diversify your income. Having multiple sources of income can help you weather financial storms. Consider ways to earn extra income, such as freelancing, starting a side business, or investing in stocks or real estate.
Four, build your skills. New skills can increase earning potential and job security. Consider taking courses, attending workshops, or pursuing further education in your field.
Five, maintain good credit. A good credit score can help you secure loans and credit cards with lower interest rates, which can save you money in the long run. Make sure to pay your bills on time. Keep your credit card balances low, and check your credit report regularly.
Next, let us move on and talk about seeking professional help. While taking proactive steps to manage your finances and mental health is important, seeking professional help is sometimes necessary. Whether you are struggling with debt, feeling overwhelmed by financial stress, or experiencing mental health issues, there are professionals who can provide guidance and support. With the right support, you can gain the knowledge, tools, and confidence to navigate your circumstances.
Financial professionals can help you create a budget, manage your debts, plan for retirement, and make informed investment decisions. They can also provide personalized advice based on your financial situation and goals. So, when choosing a financial professional, make sure to look for someone who is qualified, experienced, and has your best interests at heart.
In addition to financial professionals, mental health professionals, such as therapists and counselors, mentors, and coaches, can help you manage stress, anxiety, depression, and other mental health issues. They can provide a safe and supportive space to talk about your feelings, help you develop coping strategies, and provide tools and resources for mental wellness.
Remember, seeking professional help is not a sign of weakness but of strength. It shows that you are taking charge of your financial and mental health and making a commitment to your overall well-being. Trust me, financial and mental health challenges can be complex, and having the guidance of trained professionals can make a significant difference in addressing these issues effectively.
If you are not sure where to start to find a suitable financial professional, seek recommendations from trusted sources or research reputable firms. Choosing a financial professional who aligns with your needs and values is important. Similarly, when seeking a mental health professional, you can look for therapists, counselors, or coaches who specialize in financial-related stress or have experience addressing similar issues. You can also consider reaching out to your primary care physician, employee assistance program, or local community resources for referrals and recommendations.
Taking the initiative to seek professional help demonstrates a commitment to self-care and personal well-being. With the support of financial professionals and mental health professionals, you can gain the skills and insight needed to manage your challenges and achieve a healthier, more balanced life.
Now that we have discussed the importance of learning about the link between finances and mental health and acting to build a financial coping toolbox let's address the third and final point of today's episode. How we can advocate for better financial and mental well-being.
One of the most powerful ways to promote financial and mental health is to encourage open conversations. Yes, open conversations about money and mental health. In many cultures, talking about money is considered taboo, it's a no no. This silence can lead to feelings of shame, isolation, and stress, which can negatively impact mental health.
Encouraging open conversations about financial stress and mental health starts with acknowledging that these are common issues that affect many people. Financial struggles such as debt or job loss can lead to anxiety, depression, and other mental health challenges. It is a fact that when people feel isolated or ashamed about their financial and mental health problems, they may be less likely to seek help and discuss their concerns.
Discussing financial stress and mental health can create a culture of transparency, understanding, and support. We can help normalize these experiences and show that it is okay to seek support. Breaking the taboo around discussing money can also lead to practical solutions as individuals share tips and resources for managing finances and coping with stress.
Let me share some benefits of having open conversations about money and mental health.
One, reduced stigma. Talking openly about money and mental health can help reduce the stigma associated with financial stress and mental health issues.
Two, increased understanding. Open conversations can help people better understand the connection between financial stress and mental health and how one can impact the other.
Three, improved support. When we talk openly about our financial and mental health challenges, we can create a supportive network of friends, family, and colleagues who can offer advice, encouragement, and assistance. This support can be invaluable for those facing financial or mental health challenges.
Four, promoting awareness. Discussing financial stress and mental health increases awareness of these issues and their impact on well-being. This awareness can lead to positive changes, such as seeking help or making lifestyle adjustments.
Five, finding solutions. Open conversations can lead to practical solutions for financial and mental health problems. When people share tips and resources, they can help each other manage their challenges more effectively.
Breaking the taboo around discussing money and mental health is very important for promoting well-being. Encouraging open conversation can create a culture where people feel supported and empowered to address their challenges.
Next, I want to explore how we can support friends or family members who are experiencing financial or mental health issues.
Supporting friends or family members who are experiencing financial or mental health issues is a compassionate way to promote well-being. Many people face financial stress or mental health challenges and knowing how to offer support can make a significant difference in their lives.
When someone we care about is experiencing financial or mental health issues, it can be difficult to know how to help. As a result, it is important to approach the situation with empathy and understanding financial problems can be particularly sensitive as they often involve feelings of shame or embarrassment. Similarly, mental health challenges can be difficult to discuss, especially if there is a fear of judgment or stigma.
Here are a few ways to offer support to friends and family members who may be struggling.
One, listen without judgment when a friend or family member opens up about their financial or mental health struggles, listen without judgment or criticism, allow them to share their feelings and experiences, and validate their emotions. Simply being there to listen can provide a sense of relief and show that you care.
Two, offer practical help, depending on the situation, you may be able to offer practical help such as helping them create a budget, finding community resources, or connecting them with a financial or mental health professional. You can also offer to help them find a suitable provider or accompany them to an appointment.
Three, be supportive and encouraging. Offer words of encouragement and support and remind your loved ones that they are not alone. Small gestures like a kind note or supportive text message can make a big difference.
Four, encourage them to prioritize self-care, such as getting enough sleep, eating well, exercising, and engaging in activities they enjoy.
Five, remember to respect their privacy and only offer help if they are comfortable with it. It is important to respect boundaries and ensure that your help is welcome.
Six, connect them with community resources. Many community resources and support networks are available for people experiencing financial or mental health issues. This can include financial education programs, support groups, and mental health services. By the way, sharing information about these resources can empower your loved one to seek the help they need.
Here are some examples.
Local community centers. Many community centers offer free or low-cost financial literacy programs, counseling services, or support groups. These centers can be valuable resources for individuals facing financial or mental health challenges.
Nonprofit organization. Nonprofits often provide assistance with financial issues or mental health challenges. For example, organizations like the National Foundation for Credit Counseling (NFCC) offer free financial counseling, while groups like the National Alliance on Mental Illness (NAMI) provide support and resources for mental health.
Three. Employee assistance programs (EAPs). Many employers offer EAPs that provide free or low-cost counseling services, financial advice, or other resources. Encouraging your loved ones to explore their employer's EAP can be helpful.
By offering support and highlighting community resources, we can help our loved ones navigate their challenges and improve their well-being. Because supporting others in financial or mental distress is a meaningful way to promote both financial and mental health.
Finally, I want to emphasize the importance of financial education for mental well-being as it is a critical component of financial and mental well-being.
Financial literacy empowers individuals to make informed decisions about their money, which can reduce stress and enhance their quality of life. By advocating for financial literacy programs in schools and communities, we can equip people with the knowledge and skills they need to manage their finances effectively. In so doing, they can make informed financial decisions, achieve their financial goals, and reduce financial stress. Here are the reasons financial education is so important.
One. When people have a solid understanding of financial concepts, they are better equipped to make informed decisions about budgeting, saving, investing, and managing debt. This improved decision-making can prevent financial problems and reduce the stress associated with poor financial choices.
Two. Financial literacy can help people avoid common financial pitfalls like high-interest debt or inadequate savings. By learning about emergency funds, credit scores, and retirement planning, they can prepare for unexpected expenses and protect their financial health.
Three. Financial stress is a significant contributor to anxiety, depression, and other mental health issues. As I mentioned before, financial education can reduce financial stress and promote mental well-being by teaching individuals how to manage their money effectively. Unfortunately, many people lack access to financial education, particularly in schools and communities. This can lead to financial illiteracy, poor money management, and increased financial stress.
That's why advocating for financial literacy programs in schools and communities is so, so very important. We can take several actions to do this.
We can support financial literacy programs in schools. Financial education should start early, and advocating for financial literacy programs in schools can help young people develop healthy financial habits. We can support these programs by encouraging school boards and policymakers to include financial education in the curriculum.
Two, promote community financial education. As I mentioned earlier, many communities offer financial literacy programs through libraries, community centers, or non-profit organizations. Promoting these programs and encouraging participation can help Individuals and families improve their financial knowledge.
Three, encourage employees to offer financial wellness programs. Employers play a significant role in financial education, and encouraging them to offer financial wellness programs can benefit employees. and their families. These programs can include workshops, financial counseling, or resources to help employees manage their finances effectively. A well-educated employee is a very productive employee.
I will end this point by saying that advocating for financial education is an investment in our collective well-being. By equipping individuals with the knowledge and skills they need to manage their finances, we can reduce financial stress, improve mental health, and create a healthier and more financially secure community.
As I wrap up today's episode, let me summarize what we talked about.
We explored the intricate relationship between finances and mental health. We began by learning about the connection between money and mental health, highlighting how financial stress can lead to anxiety and depression. We then moved on to building a financial coping toolbox, emphasizing the importance of budgeting, planning, and building financial resilience. And lastly, we advocated for better financial and mental health, encouraging open conversations, supporting those in distress, and advocating for financial education.
As we conclude, I will encourage you to take a moment to assess your own financial health and consider the impact it may have on your mental well-being. Take proactive steps to improve your financial health, whether that involves creating a budget, building an emergency fund, or seeking professional help.
As Benjamin Franklin wisely said, an investment in knowledge pays the best interest. By investing in your financial literacy and well-being, you are also investing in your mental health.
Remember, financial wellness is not just about having more money. It's about having a healthy relationship with money, feeling confident and secure in your financial situation, and using your money to live a fulfilling and enjoyable life.
So, let's continue the conversation about money and mental health. Let's support each other in our financial and mental health journeys, and let's advocate for financial education and resources that empower individuals and communities to thrive. I'm going to quote Maya Angelou, who once said, do the best you can until you know better. Then, when you know better, do better. Let's try to do better for ourselves and others regarding financial and mental wellness.
This brings us to the end of today's episode. Thank you for tuning in. I hope this episode has provided you with valuable insights and inspiration. And remember, financial wellness is a journey, not a destination. It's about taking small steps every day to improve your financial situation and prioritize your mental health.
Join me next week as we continue to explore topics that impact our lives and our well-being. I am your host, Marie-Jo Caesar. Until then, continue merging life and money. Bye for now.