Money on the Mind: Facts About Financial Stress and Mental Health

For the first time since 2015, research shows that money stress has reached an all-time high. This shouldn't come as a surprise considering the last few years. We've seen the job market up-ended by pandemic lay-offs and The Great Resignation. Inflation continues to increase the cost of living. And cryptocurrency has taken the investment world by storm. So it's no wonder financial stress and mental health are becoming a top concern for so many American employees. 

According to the American Institute of Certified Public Accountants (AICPA), nine in ten young adults who have experienced stress about their financial situation say it has negatively affected their mental well-being.

Long before COVID-19 turned our world upside down, BrightUp was building relationships with employers who wanted to create a brighter, wealthier future for their employees through financial wellness benefits. As an emotionally intelligent benefit provider, we're speaking up about the critical link between financial stress and mental health. And we're empowering employers and their employees to make a change. 

In this article, we'll talk about: 

How Financial Stress and Mental Health Are Connected

You may have heard the old saying, "Money can't buy you happiness." And we tend to agree. 

While this statement is true in many ways, that doesn't mean that money does not affect mental health. In fact, financial stress is a huge factor in how you feel mentally and emotionally.

Before understanding how financial stress can be so closely connected to mental health, you must first understand what financial stress is. We talk more about the elements of financial stress in another article, so for this blog post, we'll sum things up.

Financial stress can look different for each person. It could be something as general as feeling anxious about your finances or worrying about money all the time. Or it could be something more specific like struggling to make ends meet, not being able to afford things you need or want, or dealing with debt from credit cards and loans. 

All of these situations can take a toll on your mental health in different ways — some obvious and some less so — and it's important to recognize the signs so that you can get help if needed.

What Happens When You Let Financial Stress Build Up?

If you let your financial stress build up, it could break you down. 

While everyone experiences financial strain at some point in their lives, it doesn't mean you're destined to suffer from it. But it's an unfortunate reality for many who don't know how to cope with financial stress. 

According to the Society for Human Resource Management (SHRM), 31% of Americans reported feeling finance-related anxiety, and 19% reported financial-related depression. Of those polls, Americans making less than $30,000 annually were more likely to have sought help from a health practitioner for financial stress (20%).

When you live in a constant state of stress, it can wreak havoc on your physical and emotional health. The buildup of stress hormones can lead to anxiety, depression, and other physical symptoms such as rapid heartbeat, insomnia, or high blood pressure. Financial stress can also influence unhealthy habits like overeating, binge drinking, and smoking. Plus, it's hard to focus if your mind is preoccupied with money worries.

This combination of poor health and lack of focus can lead to problems at work—and fewer work hours mean less income. So this cycle is a recipe for even more anxiety about finances!

Relationship problems are another common side effect of financial strain. You may feel increased pressure on an established relationship or experience difficulties when trying to form a new one.

As you can see, there are so many ways that letting your financial stress build up can affect your life negatively. 

For now, let's focus on three primary outcomes:

  1. Health problems
  2. Depression
  3. Anxiety

Financial Stress and Health

There's a clear link between health and financial stress. Remember those pesky stress hormones we mentioned earlier? Well, they can cause a lot of problems when your body is producing them at a constant rate. This prolonged state of stress is called chronic stress, and it can put your health at risk. Let's discuss the three stress hormones:

  1. Adrenaline
  2. Cortisol
  3. Norepinephrine

And how they impact your long-term health. 

Adrenaline: The Fight or Flight Hormone

When a stressful situation arises, the brain will trigger the release of adrenaline into your system. For example, when you receive a surprise bill in the mail. Suppose you're living paycheck to paycheck already and didn't have this expense budgeted. In that case, it's easy for your stress to spike immediately. Your heart may race, and you may start sweating. This is a physical response to the adrenaline pumping through your system. 

If your body is overproducing adrenaline, you may suffer from anxiety, weight loss, heart palpitations, and high blood pressure. 

Cortisol: The Stress Hormone

Cortisol takes a little longer to enter your system. It can affect your blood sugar levels, ability to metabolize, inflammation levels, blood pressure, and memory formulation. Continuous production of cortisol can cause weight gain, high blood pressure, anxiety, and depression. 

Norepinephrine: The Focus Hormone

Similar to adrenaline's fight-or-flight effect, norepinephrine causes a heightened state of awareness and focus. This hormone can increase the heart rate and blood pressure, helps break down fat, and increases blood sugar levels to provide energy to the body. It also plays a role in the sleep-wake cycle. 

If your norepinephrine levels are off, you may have difficulty keeping a steady sleep schedule, focusing on a task, or maintaining your emotions. This can lead to insomnia, lethargy, depression, anxiety, and substance abuse. 

As a result of these three stress hormones, people who are dealing with long-term financial stress may experience: 

When these hormones are released, it’s because your brain has told your body that something is wrong. When financial stress arises, it’s important to pause and take a moment to notice how you’re feeling. Do you feel tension in your body? Do you sense your quick heart beat? Instead of ignoring these signs and powering through, do yourself a favor. Sit with these feelings in the moment and try to understand why you may be feeling this way. 

Taking a moment of money mindfulness can help you unpack your unhealthy beliefs about finances and better manage your emotions around them. What happens when you don’t? Those temporary emotions can become permanent and turn into depression and anxiety. 

Financial Stress and Depression

It's not surprising that financial stress can lead to depression. If you think about it, the connection makes perfect sense. It's not just about the money – it's about feeling like you're not in control.

When you're stressing about money, it can feel like there's no way out. You may dread going to work because that only leads to more bills. You might spend hours on the internet trying to find a way out of your financial mess. And if that doesn't work, you might try to ignore your problems entirely — which often leads to even more debt and stress.

This is a downward spiral that could lead directly to depression. If you've been feeling angry, sad, worried, or hopeless because of money problems, it helps to know that you're not alone. Two-thirds of Americans are struggling with similar issues, and there are resources available that can help you get back on track.

The BrightUp app pairs financial planning tools and education with uplifting messaging that helps you shake off your negative thoughts and approach your finances in a more positive mindset. This is just one example of a plethora of financial wellness resources that are out there. 

Financial Stress and Anxiety

When you're stressed, your body responds as though it's under attack, releasing those hormones that increase your heart rate and raise your blood pressure. As a result, you might feel jittery, nauseous, or have a headache. In the short term, this is not a problem. But if this flight-or-flight response is triggered often, you may develop an anxiety disorder. 

In the past few years, anxiety has become one of the most significant mental health issues in North America and worldwide. So what’s the difference between financial stress and financial anxiety? Stress is often tied to external stimuli. In this case, it might be the surprise bill in the mail or a flat tire. Anxiety is typically caused by forces that are internal. So if you’re ruminating about the possibility of getting hit with a surprise bill, when there’s no actual issue - you’re probably experiencing anxiety. 

One of the biggest mistakes people make when they’re feeling financial anxiety is to ignore it. Just because the problems causing your anxiety aren’t always tangible, doesn’t mean the impact of those feelings aren’t real. There’s a belief that if you don’t talk about it or address it, then your feelings aren’t real. However, if you continue to sweep your problems under the rug, the situation could worsen. 

You owe yourself the opportunity to overcome your financial stress. Talking with a financial coach that can help you understand your own thoughts and feelings about money could be the answer to breaking you free. 

How to Know if Your Financial Stress is Affecting Your Mental Health

Maybe you haven't stopped to take the time to notice, but it's likely that your financial stress is impacting your mental health. 


BrightUp believes that how people feel about themselves affects how they treat themselves, mainly when involved in finances. So it's important to recognize when your feelings may be affecting your decision-making abilities. If you're experiencing any of the following symptoms, it might be time to address your emotional needs:

If any of these sound familiar, here are some questions you can ask yourself: 

  1. How many days per week are you having these feelings? 
  2. Are they more frequent than they used to be?
  3. Do they worsen when you think about something specific related to money? If so, what is it? 
  4. Is there a pattern with these feelings? For example, do they always occur right after payday or at the end of each month when bills are due? 

Knowing the answers to these questions could help you pinpoint what's causing them and give you guidance on how best to manage them. We talk more about how a financial coach can help you answer these questions on our blog!

Worrying about money takes your time, energy, and focus away from other things. Worrying is essentially a form of self-abuse that's very difficult to stop. Worrying doesn't make us feel better, but it does keep us focused on what we're worried about (which may be making it worse!) 

If you're constantly worried about money, you probably feel overwhelmed by the sense that there's nothing you can do to solve the problem. Trying to focus on anything else becomes difficult or impossible.

It's time to break yourself free from the worry and guilt of your financial stress and take back your finances

How to Deal with Financial Stress 

The first step to overcoming financial stress and getting your mental health back on track is admitting you need help. But, again, remember that you are among millions when it comes to facing financial strain. Therefore, you don't need to be ashamed of your financial situation or your need to ask for help. 

So who do you ask? You have a few options: 

  1. Confide in family and friends 
  2. Ask your employer for support
  3. Get advice from a financial coach

Your family and friends love and care about you. If you're in a pinch and you need money now, they may be able to help you get by until you can get back on your feet. If you don't have that support system, you may want to reach out to your employer to ask if there is anything in your employee benefit plan that can help. Finally, talk to an expert. Financial coaches are trained experts that can help you unpack your financial traumas and set achievable and measurable goals for your finances. 

As a financial wellness benefits provider that provides access to financial coaching and advice, we like to think we have the inside scoop on what to do to get your financial stress under control. So here are some tips to help you deal with financial stress and discover a few mental health tips along the way: 

1. Understand the state of your finances. To start, make a list of everything you owe and what you need to pay for each month. From there, create a budget. The following steps become much easier once you see everything in one centralized view. 

Here's a quick tip: Find a financial planning tool to help! The BrightUp app allows you to see all your accounts, including your debts, in one centralized view. It helps to let you know where you can best cut costs and track your progress! 

2. Pay off your debts and reduce your spending if possible. Some debts will take longer than others to pay off, so work with what you can do today. Whether you're paying off small debts or reducing your spending by $200 a month until you can focus on paying down more significant debts, any change is a change in the right direction. 

Yes, this may mean canceling some subscriptions or going out less often—but the peace of mind is worth it! Lifestyle changes will be different for everyone; what matters most is staying focused on the goal of eliminating debt and improving overall financial health. Improved mental health will follow. 

3. Find ways to increase your income. This could mean asking for a raise at work, starting a side business, picking up freelance work, selling items you no longer use, or updating skills. At first, this may feel like you’re adding more stress to your plate, but the long-term benefits will significantly outweigh the initial discomfort.

4. Consider a debt consolidation loan. A debt consolidation loan is typically a better option than a balance transfer credit card, which can come with higher interest rates. If your debt feels too overwhelming to overcome, you may want to look into a loan that provides one simple payment for all of your expenses at a lower interest rate. (This is one of two types of compassionate capital we provide at BrightUp!)

5. Improve your financial education. If these tasks feel overwhelming, you may benefit from further financial education. Empower yourself with the knowledge to make financial decisions on your own terms with personalized financial education from BrightUp. If this article has been helpful, imagine what you could learn about finding the best loan or building up your savings with compound interest. 

We could keep going, but we'll save the rest for our experts! 

End Financial Stress Now

BrightUp understands that knowing what to do is half the battle when it comes to managing your money. Everyone needs and deserves encouraging, supportive, and affordable banking solutions.

We hope you find these tips helpful and reach the end of this article feeling empowered to overcome your financial stress for the sake of your mental health. Now, let us help you meet and exceed all your financial goals.

At BrightUp, we believe everyone deserves a brighter path forward. We help workers and their loved ones grow their net worth and improve their self-worth. Our products give employees and members a full suite of financial tools tailored to their individual needs. With us, you get access to cutting-edge financial tools, compassionate capital, and personalized financial education, paired with a compassionate guide who meets you where you are and empowers you with education when you need it. 

Learn more about how BrightUp can help you and your employer build a brighter future with financial wellness benefits.

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