Tips and Advice

How Finances Can Affect Your Mental Health

Your money troubles can hurt your mental health. Learn from experts how to recognize the signs of money stress and find out where to get help.
A man and woman with worried expressions check their finances using their computer
Written by:
Anna Baluch
Edited by:
Kristin Marino verified

Mental health and finances go hand in hand. In fact, research shows that those who suffer from depression and anxiety are three times more likely to be in debt. Let’s take a closer look at how your finances affect your mental health and what you can do to cope with financial stressors and lead a higher quality of life.


Who Is Affected by Financial Stress?

People from all walks of life can experience financial stress. However, it’s more common in individuals and households with low incomes. They might worry about earning enough to make ends meet and cover basic expenses such as rent, utilities, and groceries. Financial stress is also widely seen among those with student loan debt or older adults who are nearing the age of retirement and long-term care.

According to a joint study by the Global Financial Literacy Excellence Center and the George Washington University School of Business, 65% of women reported feeling anxious about their finances, compared to 54% of men. The study also discovered that the percentage of financially anxious individuals is highest among those who are young, not married, and unemployed. Despite this, however, it uncovered that even respondents with a higher than average income feel anxious when thinking about their personal finances.

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Why Does Money Impact Mental Health?

There are a number of reasons money affects mental health. If you’re facing money challenges, you may struggle to pay for basic living expenses. This can lead to feelings of embarrassment, shame, and guilt. You may also find yourself with the burden of debt, which can be tough to climb out of.

Additionally, financial problems can inhibit or delay your short and long-term goals. If you don’t earn enough money or are drowning in debt, for example, you might not be able to save for a house, retirement, or your child’s college.


How Does Money Impact Mental Health?

Money can take a serious toll on your mental health. It may lead to these implications:

Changes in sleeping and eating patterns

If you’re coping with debt or a loss of income you may toss and turn at night, failing to get a good night’s sleep. Financial issues can also cause you to binge eat or even eat less than you should be in an effort to save money. It’s important to note that changes in sleeping and eating patterns are signs of depression.

Depression and anxiety

Money offers a safety net. Therefore, facing constant money worries can leave you feeling anxious and depressed. These mental health conditions may lower your energy levels, hinder your concentration, and make it difficult for you to perform day-to-day tasks. Instead of enjoying life, you may spend your days worrying about money and living with physical anxiety symptoms like panic attacks, sweating, and a pounding heartbeat.

Relationship difficulties

It’s no surprise that money is one of the most common issues in marriages. Couples are often seen arguing about everyday expenses, spending habits, savings, and financial priorities. This can cause anger and irritability, making it difficult for spouses to connect with one another and enjoy a healthy relationship. Money woes might also affect your relationship with your children, friends, and other loved ones.

Social withdrawal

If you’re embarrassed about your financial situation, you may withdraw from social situations with family and friends, especially if you tend to keep your money issues to yourself. You may choose to stay at home instead of attending social gatherings because you don’t have the funds to participate in them or are simply too stressed to enjoy them. Since social withdrawal often results in loneliness, depression, and substance abuse, it can turn into a serious problem.


How Do Mental Health Issues Impact Our Finances?

If you’re struggling with anxiety or depression, you may lack the energy or motivation to keep track of your money. When times get tough, you might make rash spending decisions that steer you into financial hardship.

Mental health conditions can also make it a real challenge for you to find and keep a job with a steady paycheck. If you’re unable to work, you won’t have the funds to cover your day-to-day expenses and will likely find yourself in a cycle of debt.

In addition, if you’re living with a mental health issue such as dementia, you lack the mental capacity to make smart decisions about money. In this case, someone else may have to make the decisions for you. Bipolar disorder is another common mental health condition that might affect your finances. It may lead to impulsive spending sprees when you’re feeling extremely depressed or extremely happy.


What Can You Do If Money Issues Are Affecting Your Mental Health?

If money problems have wreaked havoc on your mental health, there are steps you can take to improve your situation. By taking care of yourself and your finances, you may enjoy financial stability and a fulfilling lifestyle down the road.


Take care of yourself

To take care of yourself, consider the following options.

Speak Up: While it may be tempting to keep your money struggles to yourself, doing so can do more harm than good. Open up to a trustworthy friend or family member. This way, you’ll be able to release any pressure you may feel and talk through your feelings. Even if the individual you talk to doesn’t offer any advice or suggestions, you’re sure to feel better after you express yourself.

Relieve Stress: When you’re feeling overwhelmed with debt or anxious about money (or anything else for that matter), engage in activities that will relieve stress. Soak in a warm bath, go for a walk around the neighborhood, take up a new hobby, meditate, or watch your favorite movie.

Seek Medical Attention: Left untreated, mental health problems can quickly spiral out of control. If you see a doctor or mental health professional, you can figure out what your condition is and how you can treat it safely and effectively. Seeking medical attention is particularly important if you notice changes in your sleeping and eating patterns.

Eat Healthily: It’s not uncommon for those with money struggles to binge on fatty, sugary, and processed foods. Since an unhealthy diet can make matters worse, do your best to stick to nutritious foods like fresh fruits and veggies, whole grains, and lean proteins.

Exercise: Working out on a regular basis can relieve stress, clear your mind, and improve your physical health. You don’t have to run a marathon every day. Even 30 minutes of daily low-impact exercise like yoga or walking can go a long way.

Get a Good Night’s Sleep: By sleeping well, you’ll be more likely to function effectively throughout the day and avoid impulse purchases as well as other poor financial decisions. If you’re having trouble sleeping, ensure your bedroom is a quiet and comfortable place. Also, avoid alcohol and large meals before bedtime.


Take Care of Your Finances

Whether you’re overwhelmed with debt or simply wish you had more money or could qualify for better financing options, these strategies are worth considering.

Budgeting: A budget is a spending plan based on your income and expenses. It can make it easier for you to manage your money and avoid overspending. With the 50/30/20 budget, for example, 50% of your income will go toward your needs, such as rent or mortgage and groceries. Thirty percent will be used for your wants like restaurant meals and vacations. You’ll allocate the remaining 20% to your savings goals. Other types of budgets you may want to look into include the “pay yourself first” budget and the “zero-based” budget.

DIY Debt Solutions: Debt snowball and debt avalanche are DIY debt relief solutions you may want to explore. With the debt snowball strategy, you focus on paying off your smallest debt first, then applying the payments that you were previously using toward it to pay the next smallest debt. The debt avalanche focuses on saving you the most money in interest over time.

Debt Consolidation: Debt consolidation refers to any program that helps you combine multiple debts in a single, management payment. Examples of debt consolidation include debt consolidation loans, debt management plans, and debt settlement programs. They’re designed to make the debt payoff process easier.

Debt Management Plans: A debt management plan (DMP) may be a good option if you have a significant amount of credit card debt. It can allow you to lock in lower interest rates with your creditors and get out of debt faster than you would with minimum payments. Keep in mind, however, that you will have to pay a fee to enroll.

Credit Counseling: With credit counseling, you can get out of debt through an affordable payment plan that fits your budget and lifestyle news. Once you decide to work with a credit counseling agency, you may also receive help with your budget, a review of your credit reports, and useful tips and tools to help improve your finances.

Additional Income: If your full-time job doesn’t pay enough, you might want to pick up a side hustle or part-time gig. You can use the extra money you earn to pay off debt and meet your financial goals. Remember you may always quit once you reach a good place financially.

Credit Score Improvements: Your credit score is a three-digit number that indicates how risky you are of a borrower. The higher your credit score, the more likely you’ll secure low rates and favorable terms when you need financing. A good credit score can save you thousands of dollars over your lifetime so it’s important to improve it if it’s low. To do so, pay your bills on time, lower your debt, and review your credit reports often so you can dispute any errors or inaccuracies.

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Mental Health and Money: From the Experts

AmONE spoke with experts in the fields of money and mental health to learn more about the signs of stress brought on by money worries and how to get help.


Meet the Experts

Naomi Murphy is a clinical and forensic psychologist, an honorary professor of psychology at Nottingham Trent University, and the co-founder of Octopus Psychology.

Frank Thewes LCSW is a private practice therapist based in Princeton, New Jersey, working with clients who experience anxiety, depression, trauma, anger management issues, and life transition difficulty. You can connect with him at

Tatiana Tsoir is a business and pivot coach, empowerment author, and speaker. She helps women go after their bold dreams so that they can be their own boss and make money doing what they love. In her signature mastermind program ‘Something That’s Yours,’ she supports women in learning to color outside the lines (except for the financial ones!) and re-discover that warrior girl she always had inside.

Tatiana is CPA and a numbers expert and helps small business owners take charge of their numbers, take back their time and work less, make more, and take more time off. In her book “Dream Bold, Start Smart,” Tatiana provides the reader with simple and actionable steps that help take the anxiety out of starting a business.

Tatiana is a frequent speaker at conferences and podcasts, has her podcast “Talk to Tatiana” and her YouTube Channel where she shares helpful tips with her audience and has conversations with world experts about their entrepreneurial journey. Tatiana has been featured in “The List,” Cogneesol, Thrive Insider, and National Speaker Association.

Andrea Woroch is a nationally recognized family finance expert, writer, speaker, and TV contributor covering all things money at She has appeared on NBC’s Today Show, Dr. OZ, Good Morning America, FOX & Friends, MSNBC, CNN, ABC News with Diane Sawyer, and been quoted in New York Times, Wall Street Journal, Money Magazine, Kiplinger Personal Finance, Better Homes & Garden, and many others.


Why does money impact mental health?

Murphy: Obviously, we need a certain amount of money to survive – pay a mortgage/rent, buy food and clothes, pay medical bills, etc. and when we are worried about whether we have enough money to cover our basic cost of living we are essentially worrying about our ability to live.  This is amplified when we have dependents whom we are also responsible for.  This worry is enhanced for men who have dependents as men have generally been socialized to think of themselves as “providers” and can feel quite emasculated if unable to pay their way.

However, even those who aren’t struggling can find themselves worrying about money.  Finances are tied to social standing or status.  Those who have the most status tend to have better access to all sorts of additional resources (above necessity) including power, influence, and social connections which strengthens one’s place in society.

Within more materialistic, consumer-driven societies, secure finance is typically interpreted as a sign of success and value.  Those who don’t have access to the trappings of financial security don’t tend to be as highly valued as members of society and equally can end up not valuing themselves.  Within many western cultures, we are socialized to judge ourselves according to our achievements and finance is one tangible way to symbolize this.

Thewes: Money directly corresponds to housing security, food security, and access to health care. This is why money can impact mental health. Having a lack of money in western culture often means that housing, food, and health care access are under threat. These things are at the core of survival in our culture. When we perceive our ability to survive is threatened we can experience stress, anxiety, depression, and trauma. These are all seriously impactful on mental health.

Tsoir: The concept of money management, investments, and savings is only 50+ years old, so we all are amateurs at it, and we learned from even bigger amateurs (our parents, grandparents, etc). Money is the elephant in the room — nobody talks about it, but everyone thinks about it. So, of course, it affects your mental health. And even those with unlimited supply stress about preserving the money or making more. When COVID happened, what was the first thing people thought about? Money. Will I have enough? Will I be able to put food on the table? Will my dreams shatter? That’s why money is in the center of mental health.

Woroch: We often identify our self-worth with our financial status. Therefore, someone who is drowning in debt, struggling to pay their bills, or has lost their job may suffer mentally because of this direct correlation. Not to mention, these financial struggles can make achieving goals and doing everyday things more challenging which can also have a direct impact on your mental health.


What are the signs that your mental health may be affected by your financial situation?

Murphy: If you’re thinking about money a lot of the time then that’s a surefire way to know that it’s affecting your mental health.  If your mental energy is being used in this way because you lack enough money to live comfortably and you’re worried about how you’re going to pay your bills, worry is going to be taking up emotional and physical energy and make you less able to cope with other life issues.  Chronic worry is not only implicated in mental health but also impacts our physical well-being.

Signs that financial worry may be affecting us are – difficulties getting to sleep or staying asleep; craving sweet foods for energy; feeling low in mood and struggling to get up in the morning; feeling hopeless about the future; being more irritable than usual; finding it hard to make decisions about other things because we are already using too much mental energy up with worry

Stress and emotional strain are reflected within our bodily structure so we can find ourselves with aches and pains in joints and muscles; jaw, neck, and headaches due to tension.  Key signs that your body is under strain are raised shoulders, shallow breathing.

People sometimes find themselves thinking about (or even using) strategies that wouldn’t normally be that appealing and that might make their problems worse such as gambling or taking out a payday loan.  Others resort to other coping strategies such as drinking, spending, and so on. It’s not helpful to go down this route and it will just compound your problems – reach out for help before you get to this stage.

Thewes: One sign that your financial situation is impacting your mental health is if you find yourself frequently worrying about your finances when you would normally be sleeping. Sleep disruption is impactful on mental health. What we are worrying about when we want to be sleeping – such as money problems – are often signs that these things have grown into a major disruption for our mental wellbeing.

Tsoir: I remember when my dad would always scream about stupid stuff one day, and be totally cool with it the next. I was so confused about the conflicting messages. When I grew up and had my kids, the pressure of “making it,” the pressure of living paycheck to paycheck, or project to project knowing that if that customer doesn’t pay you… you cannot pay your mortgage. While building my practice when I had my kids and was home a lot, I started doing the same exact thing. Worried about money during the day, and felt trapped and stuck with the same ugly kitchen and my kids and husband saw the ugly side of this worry. So one sign is bringing your business or work home. The hype we get from that desired purchase (a new iPhone, a Tesla, a [fill in the blank]) gets canceled, and then some by the stress of not making enough. Another sign is when someone feels unexplained anxiety (that’s a big one).

Where and how can people get help if their finances are hurting their mental health?

Murphy: You need a two-pronged approach here.  Although it’s tempting to avoid dwelling on your finances, avoidance won’t make the problem go away.  Within the UK – the Citizens Advice Bureau is a great source of free advice and help.  The website Martin Lewis also offers some good advice about saving money.

In terms of your mental health, within the UK you can ask your GP to refer you for counseling.  Unfortunately, there are often long waiting lists.  Seek out charities that support mental health such as MIND and look online for support groups.

It’s probably also important to mention that sometimes people have money worries because they’ve lost their job or simply don’t earn enough which is pretty shocking when you look at how wealthy some people are.  However, some people create money problems due to their mental health – buying goods or drinks or drugs as a means of coping with unhappiness and losing their ability to make good financial decisions.

Thewes: If your finances are hurting your mental health you can do a few things. If you have health insurance you can check your plan’s doctor finder for therapists to help with your stress management and coping, or search on aggregators like for therapists who work with your in or out of network plan benefits. If you do not have health insurance then you can try inquiring with local community mental health agencies and local social services agencies for free and low-cost therapy options or look for therapists on who work on a sliding scale.

Tsoir: The first step is living within your means. Easier said than done, I know. But, this step means taking inventory of debt as of now, and understanding how much cash you’re bringing in every month. Develop a plan of attacking debt, however long it takes. Understand where you can cut without pain (maybe refinance your mortgage, or maybe stop going to Starbucks every month). Every little bit helps. Step two is to start saving 1% of your income every week or month. Split debt into a doable amount a month and then make a plan to pay that down and never have that again. Having that plan will be the first grand step to improving mental health.

Woroch: If you’re looking to improve your mental health surrounding money, think about the root cause of your financial struggle and how you can work to improve that to improve your overall outlook. Even though it may take time to get out of debt or to get your budget in order, having a plan will give you hope and help improve your mental health at the same time.

  1. Assess your financial struggles and make a plan.
    What is it that you are struggling with that is causing you mental anguish? Is it your debt or spending? Set a goal to improve this but make sure you are being specific about what you want to achieve so you know exactly what you have to do to get there. Tracking your finances is key to getting your spending and saving under control. This allows you to see exactly where your money is going so you can pinpoint bad habits. Otherwise, how else will you know what you need to fix?!
  2. Save without sacrificing.
    Often times our mental health takes a beating when we deprive ourselves of everything that brings us joy. However, saving money doesn’t have to do that. There’s a chance you’re wasting money without realizing it and it’s important to reassess your expenses to see where you’re spending unnecessarily. This move will free up money to help you pay down debt or save up for a trip faster. To accomplish this, spend time combing through your monthly bills and look for ways to plug budget leaks or lower costs. Run a quick online search to compare rates with competitors for services like cable, Internet, and pest control. Tools like Trim help you cancel unused subscriptions, and BillShark helps you negotiate rates with providers. Digging through your bills can also uncover unnecessary add ons inflating your monthly costs.
  1. Look for ways to increase cash flow.
    Earning some extra income on the side doesn’t have to mean giving up your free time. You can make money from home easily these days. For instance, sign up to take surveys while binge-watching Netflix through Swagbucks or join a focus group online. You can even make up to $1,000 a month by pet-sitting through which is great for nights and weekends or during the week if you work from home.

Keep in mind, the way you shop can also help you earn a little extra cash through credit card rewards and cash-back tools. The extra you earn can help pay down debt or be used toward a guilt-free splurge purchase, both of which can boost your mood. Just make sure your credit card is giving your maximum cash back on your purchases or look for a new cash back card. And download a cash back plug-in like to your browser to earn money back for your online purchases or grocery deliveries.

Resources and Where to Get Help

Fortunately, there are many resources that can help you improve your mental health and financial situation. Here are several options to keep on your radar.


Mental Health Resources

National Suicide Prevention Lifeline: 800-273-8255: The National Suicide Prevention Lifeline is a confidential, free hotline you can call 24/7. It employs operators in crisis centers throughout the country who follow the best risk assessment practices. Call it if you or someone you love has thoughts of suicide.

IMALIVE: If you’re having suicidal thoughts, IMALIVE will connect you to a depression treatment center in your area. There’s a live chat feature on the IMALIVE website that can dispatch emergency personnel to your location if needed.

The Anxiety Network: This organization is for anyone who is coping with any type of anxiety disorder, such as panic disorder, social anxiety disorder, and generalized anxiety disorder. It offers a wealth of information and personal blog posts that can inspire you to overcome your condition.

Anxiety & Depression Association of America: The Anxiety & Depression Association of America uses research, education, and practice to improve the quality of life for people with anxiety, depression, OCD, PTSD, and co-occurring disorders. Its website allows you to learn more about your condition, connect with a therapist, and find out about virtual and in-person events you might find beneficial.

Depression & Bipolar Support Alliance: With the Depression & Bipolar Support Alliance, you can find support groups in your local area. Many of them meet virtually via social media, email, and online meeting tools. It also offers educational materials such as podcasts, videos, and webinars.

American Psychiatric Association: The American Psychiatric Association is the top psychiatric organization in the world. You can use its website to learn about various mental health conditions and find a psychiatrist near you.

JED Foundation: The JED Foundation is a nonprofit focused on protecting emotional health and preventing suicide. Once you share your mental health concerns on the JED Foundation website, you’ll receive access to plenty of useful resources.


Financial Help Resources

In addition to mental health resources, there are resources that can assist you when you’re going through financial hardship such as:

Temporary Assistance for Needy Families (TANF): TANF is intended to help low-income families with children become self-sufficient. While eligibility requirements vary from state to state, this program can provide you with grants to fund basic necessities like food and housing.

Low Income Home Energy Assistance Program (LIHEAP): Through this federal program, you can regulate the temperature in your homes during the summer and winter. It may also assist with low-cost repairs to heating and air conditioning systems.

Jewish Federations of North America: This national charity organization provides emergency assistance for rent, energy bills, and more. It distributes funds to nonprofits across the country. The Jewish Federation of North America also offers job training and workforce development.

Catholic Charities: If you find yourself in a crisis, you can turn to Catholic Charities for financial help, cash assistance, or other resources. There are thousands of locations across the country and you don’t have to be Catholic to take advantage of them.

Feeding America: Feeding America is a nonprofit that specializes in emergency food assistance through its food banks, food pantries, and meal programs across the country. It can also help you find long-term government assistance and guide you through the application process.

Modest Needs: This organization offers financial assistance for short-term needs, such as housing costs and utility bills. You may be eligible for one of its “self-sufficiency grants,” which can help you get back on your feet.

HealthWell Foundation: The HealthWell Foundation helps underinsured pay premiums and out-of-pocket expenses so they can avoid medical debt. Your income, medical condition, and health insurance status will determine your eligibility.