Money & Mental Health

September 13th 2024 | Categories: Debt Management | | Tags: debt |

Always got money on the mind? It may be affecting your health.

As inflation rises and back-to-back interest rates hikes, many Australians are feeling the strain of financial stress, and the consequences can extend far beyond your wallet.  

What’s the diagnosis? 

Financial stress can refer to the difficulty in covering essential expenses such as rent, mortgage, bills, or groceries, due to insufficient income. Those in financial distress can often face mounting debts, housing insecurity, and, in severe cases – a real threat of homelessness.  

It’s important to note that those experiencing financial stress aren’t limited to “money in versus money out”   mentality. It also stems from the inability to build an emergency fund or savings, or a sentiment of not being able to get ahead – leaving them vulnerable to unexpected financial shocks. 

While a low income can be a significant factor, financial stress can be experienced no matter what your annual salary is. Reduced work hours, job losses, gambling, or other addictions can all contribute to money issues.  

Additionally, those in casual positions or working inconsistent hours receiving an irregular cash flow, can often find themselves in a cycle of stress. Inconsistent income not only makes it hard to meet your weekly or monthly expenses but can also lead to difficulty securing loans or rental agreements, further deepening the cycle of financial hardship. 

Data released by Lifeline in April revealed that 15% of the 3000 calls a day to the helpline referred to financial hardship – that’s an estimated 500 calls a day. 

The connection between financial stress and mental health 

The Australian Securities and Investments Commission (ASIC) highlights the corresponding relationship between financial wellbeing and mental health. People who face financial difficulties are twice as likely to experience mental health concerns like anxiety, stress, and even suicidal thoughts.  

On the flip side, those currently experiencing mental health challenges are also at a higher risk of developing financial difficulties, creating a dangerous cycle where one issue exacerbates the other. 

Physical symptoms of financial stress can include:  

• trouble sleeping 

• headaches 

• constant fatigue 

While emotional symptoms may involve 

• guilt 

• fear 

• a sense of hopelessness 

Personal relationships can also fall victim when dealing with financial stress, with frequent arguments about money or withdrawal from friends and family being common. For more on money in relationships, read our article: All you need is love (and financial compatibility) – Invest Blue 

Breaking the cycle  

Awareness is the ultimate antidote to financial stresses biggest increaser: avoidance.   

Developing a basic level of financial literacy and clarity on your situation is the first step in any person’s financial journey. There is a range of educational books, podcasts, videos and web courses that can help foster your interest in gaining financial literacy.  

Taking care of your mental health is essential to a happy and fulfilling life. Small, daily rituals to slow down like meditation or improving sleep hygiene can help, but if negative thoughts persist, it’s vital to seek professional support.  

If you, or someone you know is experiencing hardship. Do not hesitate to seek help from:  

Lifeline on 13 11 14 or www.lifeline.org.au  

Beyond Blue 1300 224 636 or at www.beyondblue.org.au 

National Debt Hotline 1800 007 007 or http://www.ndh.org.au/  

Got a question? Why don’t you try our complimentary 15-minute discovery call. The first step in gaining clarity on your financial journey. Book here.   

If you would like to speak with one of our trusted financial advisers about your financial situation, please get in touch via the form below.

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What you need to know: This information is provided by Invest Blue Pty Ltd (ABN 91 100 874 744). The information contained in this article is of general nature only and does not take into account the objectives, financial situation or needs of any particular person. Therefore, before making any decision, you should consider the appropriateness of the advice with regards to those matters and seek personal financial, tax and/or legal advice prior to acting on this information. Read our Financial Services Guide for information about our services, including the fees and other benefits that AMP companies and their representatives may receive in relation to products and services provided to you.