According to a Harvard study, more than half (56%) of young adults ages 18-25 report that financial worries negatively influence their mental health.
“How we take care of our physical and mental health all goes together. And if we’re having basic things like money stress or poor relationship issues, then that can start a cascade of poor mental health and physical health,” says McClanahan.
As a financial therapist, Pope shared a list of some of the most common effects that he’s seen result from financial stress via Investopedia:
Anxiety and depression:
Constant worrying about finances can manifest into increased feelings of anxiety and depression, affecting overall mental well-being.
Sleep disturbance and insomnia:
Ever lie awake at night doing calculations in your head to try to figure out how you’ll pay for new brakes for your car, or if you can afford a quick road trip with friends? In a study by the American Academy of Sleep Medicine, 87% of people cited finances as a worry that has caused them to lose sleep; one-fifth of those respondents said they “almost or almost always” lost sleep worrying about money.
Physical health problems:
Long term chronic stress can manifest into physical health issues such as headaches, digestive problems, and a weakened immune system. The American Psychological Association points out that stress can actually impact every body system, causing long-term problems for your heart, gut health, nervous system, and more.
Relationship strain:
Among Gen Z, 29% of people say money is their greatest relationship challenge. And that’s no surprise given the pressure that financial strain can put on relationships with partners, friends, and family. It could be from disagreements over money or lifestyle choices, but also, money worries can cause people to feel irritable and lash out at others.
Reduced work performance:
Financial stress can lead to decreased productivity and focus at work, affecting overall job performance. In fact, nearly 3 in 4 employees (71%) say that financial stress negatively affects both their work and personal lives, according to a study conducted by Morgan Stanley at Work.
Avoiding social interactions:
People under financial stress may withdraw from social activities due to lack of funds or embarrassment. One study found 72% of respondents skipped events with family, friends, and co-workers because they couldn’t afford to attend.
Negative impact on self-esteem:
Because money is so tied to value and worth, financial difficulties can lead to some people feeling like they are failures, impacting selfconfidence.