Financial Anxiety: Finding Ways to Cope

In recent years, financial anxiety has become a common yet often silent struggle for millions of individuals and families across the UK. The rising cost of living, coupled with increasing debt, has pushed many to the brink as they grapple with managing day-to-day expenses. This anxiety can have serious mental health repercussions, affecting everything from emotional stability to overall quality of life.

According to data from the Office for National Statistics (ONS), inflation in the UK has surged over the last few years, with consumer prices rising significantly. Essentials such as food, fuel, and energy have seen some of the steepest increases, with food prices alone climbing by over 19% year-on-year in 2023. The Bank of England’s repeated hikes in interest rates have also driven up mortgage payments and loan interest, squeezing household budgets further. Research from The Money Charity estimates that the average UK household debt (excluding mortgages) stood at around £2,180 per adult last year, a stark indicator of financial pressure.

This economic strain is felt acutely by those in lower income brackets, young adults, and families with dependents. A survey by StepChange Debt Charity revealed that over 50% of people struggling with debt also face significant mental health challenges. This data highlights the undeniable connection between financial insecurity and mental wellbeing.

The Mental Health Repercussions of Financial Anxiety

Financial anxiety can manifest in various forms, from persistent worrying about money to feelings of guilt, shame, or helplessness about one’s financial situation. The effects can include:

1. Chronic Stress: Financial insecurity can lead to chronic stress, which can compromise your immune function, disrupt sleep, and increase your susceptibility to physical health problems.
2. Depression and Anxiety: When debt and financial worries feel unmanageable, many individuals experience symptoms of depression and anxiety. There may be feelings of sadness, hopelessness, or panic, making it difficult to function or enjoy daily activities.
3. Reduced Cognitive Function: Studies have shown that financial stress can impair our decision-making and problem-solving abilities, creating a vicious cycle where financial issues are harder to tackle effectively.
4. Family and Relationship Strain: Money problems are a common source of conflict within families and partnerships. The emotional toll of trying to maintain a “brave face” in front of loved ones can make financial anxiety even more isolating.

Practical Strategies for Relief

While financial anxiety can feel all-consuming, there are effective strategies to help manage and alleviate it. From creating safe spaces to discuss concerns to making use of financial resources, here are ways to tackle financial anxiety:

1. Seek a Safe Space with a Therapist
   Therapy provides a non-judgmental environment to explore your financial concerns and their emotional impact. A therapist can help you develop coping mechanisms, break negative thought patterns, and build resilience. This is especially valuable if you feel the need to “hold it all together” in front of family members or if you have dependents who rely on you. Expressing your worries with a trusted mental health professional can reduce the burden and enable you to think more clearly about practical solutions.
2. Identify What’s Within Your Control
   Financial anxiety often stems from a feeling of powerlessness. Spend time identifying which financial elements are within your control (such as budgeting, spending habits) and which are not (like inflation rates or global economic shifts). Focus on what you can change: set achievable financial goals, cut unnecessary expenses, and create a budget plan that prioritises essential needs. Knowing that you’re taking small, positive steps can offer a sense of relief.
3. Utilise Helplines and Resources for Debt Management
   In the UK, several organisations offer free and confidential debt advice and resources. The following services provide support in managing financial concerns:
   • StepChange Debt Charity: Offers free advice and debt management plans to help you regain control of your finances.
   • Citizens Advice: Provides guidance on a range of financial issues, including budgeting, benefits, and debt management.
   • National Debtline: A free helpline providing expert advice and self-help tools to manage debt.
   • MoneyHelper: A government-backed service that offers impartial money advice and debt solutions.
4. Practice Self-Care and Mindfulness
   Financial anxiety can be emotionally exhausting. Engage in regular self-care practices such as physical exercise, meditation, or journaling  (see article on journalling here) to manage stress and maintain perspective. Setting aside a few minutes each day to focus on breathing exercises (see article on breathwork here) or to write down what’s on your mind can help clear mental clutter and reduce stress levels.
5. Limit Financial Conversations and Media Exposure
   With the current focus on economic challenges in the media, constant exposure can amplify anxiety. Set boundaries around financial conversations with friends and family, and try limiting exposure to news outlets or social media discussions on the topic. Focusing on your personal financial goals rather than external influences can foster a more grounded and positive outlook.

Financial anxiety is a profound challenge that many people face today. By taking small, manageable steps and accessing available support systems, it is possible to navigate through it. Remember, you don’t have to face financial anxiety alone – help is available, and brighter days are within reach.