Money worries: how to cope with financial stress

Money worries are a common source of stress and the current cost of living crisis means that financial stress is affecting more people than ever.

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Financial stress is a feeling of tension, pressure and emotional strain that’s directly related to money. You might struggle with financial stress if you don’t make enough money to pay your bills, buy essentials such as food, or are in a lot of debt. Here, we’ll explore how financial stress can affect your mental health, and provide some tips on how to cope if you’re feeling overwhelmed.

Is worrying about money normal?

If you’re worried about money and debt, you’re certainly not alone. The American Psychological Association have found that as many as 72% of adults report feeling stressed about money, whether it’s worrying about your day-to-day expenses and outgoings, or feeling overwhelmed by debt.

Considering the impact that financial worries can have on our mental wellbeing and even our physical health, this figure is incredibly significant.

How does financial stress affect your health?

There is a clear link between financial stress and health.

When it comes to money worries and mental health, the Money and Mental Health Policy Institute shows that people with debt problems are more likely to experience mental health difficulties. In England:

  • Over 1.5 million people are currently experiencing problem debt and mental illness
  • 46% of people in debt also struggle with a mental health problem
  • 4 in 10 people with a mental health problem said their financial situation has made their mental health worse

Financial stress can result in:

  • Depression – money worries may cause you to experience the symptoms of depression, including feeling down and hopeless about the future
  • Anxiety – struggling financially can make you feel anxious, on edge, and unable to relax. You may also experience the physical symptoms of anxiety such as a racing heart, sweating, trembling and panic attacks
  • Drug and alcohol abuse, or other forms of addiction, as a way to temporarily ‘escape’ your worries
  • Sleep problems, such as insomnia – feelings of anxiety can affect sleep. You may find you’re lying awake at night, worrying about money and bills
  • Relationship problems – worrying about money can cause your relationships with loved ones to become strained. You might find that you’re constantly arguing with your partner about money, and are no longer interested in spending quality time together
  • Anger – you might find you’re more irritable than usual, and more prone to angry outbursts
  • Weight loss or gain – ongoing stress can cause your appetite to change, resulting in weight fluctuations
  • Social withdrawal – financial worries can cause you to withdraw from friends and family. This might be because you’re not in the right frame of mind to socialise, or because you can’t afford to. Either way, social withdrawal can lead to you becoming isolated and even more stressed
  • Physical health problems – chronic stress can result in physical ailments such as gastrointestinal problems, migraines, aches and pains, heart problems, high blood pressure, diabetes, and frequent coughs and colds

It’s important to understand that financial stress and mental health problems can form a cycle:

  • Financial worries can have a negative impact on your mental health
  • Poor mental health can have a negative impact on your ability to manage your finances

In addition, people with money struggles may not have the resources they need to access help. For example, they might not be able to afford insurance to pay for mental health treatment. This, in turn, can cause their mental health to become worse and lead to even more problems.

Coping with financial stress

Financial stress can have a hugely negative impact on your quality of life. However, there are a number of things you can do that may help you cope a bit better with your money worries. If you’re dealing with debt stress, these tips can also help.

Speak to a friend or loved one about your worries

Opening up to someone you trust about your financial difficulties and how you’re feeling, can really help. They’ll be able to offer you emotional support and a fresh outlook, and may suggest solutions for managing money that you hadn’t thought of. Speaking about your finances can also help you to put the situation into perspective and start taking steps forwards.

Take stock of your finances

This will help you paint a clear picture of your current situation. Look at every source of income and all of your outgoings, and see where savings could be made. For example, could you look at getting a better deal on your mobile phone, car insurance or TV package? Be proactive and look at all the different avenues for potentially cutting back, to help you feel more in control of your finances.

Could you sell some of the clothes or household items you no longer need on websites such as eBay or Vinted? These might be some quick-wins for earning extra money until you get back on your feet.

Prioritise your worries

Put your financial worries in the order in which you want to tackle them. For example, if you’re particularly worried about a credit card debt, make paying that off your main focus. Breaking your worries down into more manageable chunks can make them feel less intimidating and can make your goals more achievable.

Seek financial advice

Websites like Citizens Advice and GOV.UK provide free advice on managing debt and finances, as well as information on whether you may be eligible for benefits or other means of support. Also, if you’re struggling to pay your bills, it can be a good idea to speak to your bank, utility provider or credit card company, as they may be able to set up a payment plan that works for you and provide further advice.

Learn to manage stress

Learning to manage your stress can help you cope better day-to-day, leaving you able to focus on practical solutions for your money issues. There’s loads of small things you can do to reduce stress and deal with anxeal with anxiety, like:

Page clinically reviewed by Dr Sheetal Sirohi (MBBS, MRCPsych), General Adult Consultant Psychiatrist at Priory Hospital Woking

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