From The Compass: Finances and Wellbeing

Stress and Financial Wellbeing

While relationships are important, one key relationship that many people often fail to identify is the one they have with money. Being financially well is about more than owning the most, biggest, or best—it’s about a general sense of ease and comfort around your wider financial situation. This includes feelings of security, autonomy, and choice.

But what about when things go wrong?

People are currently living through an unprecedented climate of fear around money: having enough, or even in some cases—having any at all. Global catastrophes on the back of the pandemic have led to an exponential rise in financial difficulties for many families. Financial difficulty does not just refer to those in poverty; it refers to a consistency around having to worry about money and making ends meet.

Stress happens when people become overwhelmed by pressure and demand upon them is too great to reconcile with—either on a long-term or short-term basis. Preceding events can be positive or negative; any sort of life change prompts a need to alter current coping strategies or build new ones. Be it a work change, a wedding, a bereavement, or a longer-term change, such as saving for retirement or becoming a parent. Debt and financial burden, both short and long-term, can also be a major stressor and a prominent source of anxiety for some people.

The relationship between money and mental health runs both ways. To put it simply, your mental health—which at times is better and other times worse—can impact your financial life. Equally, when your finances suffer, it can have a detrimental impact on your mental health. If you’re stressed, anxious, or depressed about other circumstances that are happening, your spending might increase, since it gives you a “high of reward.” During these times, you may be more prone to avoid taking proactive, responsible steps towards money management. Your motivation to stay on top can falter, and you become stuck in a negative cycle. This feeds into your mood and ultimately worsens your financial situation. Beyond this, certain financial situations can create a sense of anxiety in the face of threat and danger; debts and bills adding up can contribute to this. You may end up avoiding opening emails and letters in order to evade looking at your overdue bills. Ultimately, this avoidance may lead to not being able to pay for basic amenities, like food and energy bills. As this situation deepens, so can a sense of isolation and loneliness.

A plethora of emotions are connected to stress around finances: fear, guilt, anger, and shame, to name a few. Change begins with awareness of how you feel, and that might include drilling back and asking yourself what is really going on. Imagine the scene: the letters on the table unopened, the unread email about the overdue account—you’re feeling anxious, but why and what about? These are key questions to ask yourself in order to help find how you are really feeling. Alongside these, here are some key considerations:

  • When am I more likely to spend money? How does it feel when I spend money?
  • What is the difference in how I feel when I am more likely to save money than spend money?
  • What feelings do I have when I think about money?
  • What are the things that make me feel worse about dealing with money?
  • What makes me feel good or more in control when I deal with money?

It may be useful to record your findings via journaling, which can help you to track, monitor, and become aware of your patterns regarding mind, mood, and money. This can be hard at first, but it can become easier so that you feel more comfortable engaging change.

Money and work are inextricably linked, and financial stress and its impact on employee mental health can be seen in employees’ approach in the workplace. An employee who is presenting as tired, stressed, unproductive, late, and so on may be experiencing some type of difficulty in this regard. However, it’s not just the obvious signs that are tell-tale ones. An employee that is signing up for overtime or working a second role may be overworking in order to stay ahead of their finances. While there may not be anything wrong productivity wise (or even any obvious signs that anything is wrong at all), it might be useful to monitor these types of behaviors and foster a supportive approach to finding out what might be going on. Below are a few key themes for employers to take into consideration.

1) Open communication invites conversation.

Some people find it easier than others to communicate through workplace or relational channels; certain people may find it difficult to reach out for any avenue of support at all. Employers should harness an approach of not being responsible for, but responsible to, their employees. You can’t make someone talk—but you can certainly create the opportunity to do so. Managers can ensure that employees are getting the right amount of face time with them—not to micromanage—but in order to facilitate both parties staying involved, attuned, and up to date. If isolation is part of experiencing financial stress, being included in what is happening at the company can go a long way to capture any behavior at work that operates towards financial stress, such as taking on too much overtime. Training and education in mental health, and opportunities to learn all around, can be beneficial. Awareness is key, and it may help managers be able to have these types of conversations with their employees. This is perhaps the next step in fostering an environment of wellness at work.

2) Clear Signposting

Stress happens when people are not looking. When people aren’t looking where finances are concerned, they’re usually burying their heads in the sand. This avoidance goes hand in hand with simply not knowing what the right channels or avenues of support are, and so there is great value in the simple science of signposting.

Signposting employees to where they can go for help can go a long way to leveraging the right support. The message could be simple and rolled out in one centralized place (e.g. a company intranet) as a consolidated resource hub. These can be both internal and external, local and national. Letting employees know where they can access practical and emotional support is a good start, whether this is via a wellbeing program or other means. Often overlooked, the power of signposting is the power of enabling. When it comes to internal signposting—let employees know ,clearly what is available through their employee benefits in terms of life insurance, critical illness cover or relief funds, for example.

3) Training Opportunities

Aside from psychoeducation and mental health training in the workplace, there may be a place for practical, financial education also. Simple workshop events held once per month—around managing money and finances, growing money, debt education, and more—can present an opportunity for employees to engage in their own time and of their own volition. This could be external or internal—with a sub-purpose of signposting to internal resources, which can provide employees an opportunity to feel valued, respected, and cared for—and in turn may support retention, loyalty, and healthy coping.

Financial wellbeing is part of everyone’s daily lives—no one can ignore this fact. While money; resources; and how people acquire, grow, and use these is down to each person, there are things everyone can do to help each other learn about money management. People spend most of their days at work. So, doesn’t it make sense to give your teams, employees, and coworkers a hand up? It just might be, in essence, a good financial decision to do so.


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Mental Health UK. (2017, November). Mental Health UK launches Mental Health & Money Advice. Retrieved March 6, 2023, from

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Sussex, J. (2023, January 31). Stress and financial wellbeing: Let’s talk money (B. Schuette & E. Morton, Eds.) [U.S. Edit]. Raleigh, NC: Workplace Options (WPO). Retrieved March 6, 2023, from the WPO Blog at aquí para la versión Española.