Money and mental health are connected

by | Oct 23, 2020 | Personal Finance

October is Mental Health Awareness month. There is no doubt that being in financial distress heightens your emotional distress – and research shows that money and mental health are connected. Poor mental health can make earning and managing money so much harder than it already is. Worrying about money can make your mental health worse. In the end it can be one very vicious cycle.

Understand your money and mood patterns

Working out your habits and thought patterns around money is a good place to start. It could help you start to think about things you want to work on.

  • Think about when you spend or save money and why.
  • Think about what aspects of dealing with money make your mental health worse. Is it attending appointments, opening envelopes, confrontation or being misunderstood? Or is it something else?
  • It could help to keep a diary of your spending, and your mood. Try and record what you spent and why. Record how you were feeling before and afterwards too. This could help you work out any triggers or patterns.


When you understand more about what’s happening in your life, you can think about what might help. Sometimes just being aware of these patterns can help you feel more in control.

These are some common ways money and mental health can affect each other:

  • Certain situations might trigger feelings of anxiety and panic. Things like talking to your bank, opening envelopes or having a financial assessment.
  • You might feel very anxious about a decision to spend money, even when you can afford it.
  • If you’re feeling low or depressed, you may lack motivation to manage your finances. It might not feel worthwhile trying.
  • Spending may give you a brief high, so you might overspend to feel better.
  • Going through a period of mania or hypomania may lead to some impulsive financial decisions.
  • If a mental health problem affects your ability to work then that will have an effect on
    your income.
  • Being in debt can cause ongoing feelings of stress.
  • Worrying about money can lead to sleep problems.
  • Money problems can affect your social life and relationships. You might feel lonely or isolated.
  • You might not be able to afford essential things we all need to feel well. This might be housing, food, water, electricity, medication and therapy.


In order to alleviate your mental distress – you should try and get your finances, especially your debt under control.

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