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Financial Wellbeing & Its Effects on Mental Health

January 26th was the first day of the Bell Let’s Talk campaign. There are many things you can do to get involved. This could be educating yourself on mental health, connecting with friends and family members in a kind way, or doing something positive for your own mental health.

One thing people often overlook when it comes to mental wellbeing is finances. The relationships between money and mental health can cause issues to perpetuate on either side. To learn more about financial wellbeing and the impact on mental health, continue reading below.

How does financial wellbeing affect mental health?

Whether we realize it or not, money has become a necessity in life. Technically, it’s not like food or water which we need to survive. But we need money to afford nourishment, shelter, and other necessities in the modern world. Obviously, this is not always ideal, but that’s the reality we live in. For this reason, mental health issues can arise when money problems occur.

To understand how poor financial health and poor mental health go hand in hand, consider daily stressors in your life. Maybe this is dealing with a difficult colleague at work. Or maybe it’s juggling your kids’ needs and work at home during lockdowns. Now, consider what it’d be like to have daily financial worries on top of that. Such as, how are you going to pay your bills? How are you going to put food on the table? Will you lose your house if you miss a mortgage payment? The extra layer of financial stress can cause mental health issues on top of everything else.

Mental health & young workers

In the last decade or so, mental health awareness has exploded. There are many reasons why mental health is on the radar, but one big reason is society’s youth. The younger generations have drawn a lot of attention to the importance of mental health. Specifically, Millennials and Generation Z.

In fact, many young workers struggle with anxiety, depression and other mental health issues in the workplace compared to their older counterparts. It’s hard to pinpoint exactly why, but it’s likely a combination of greater competitiveness, higher costs of living, housing insecurity, job insecurity, long work hours, and trying to achieve work-life balance. What’s worse is most of these mental health issues begin in university and college. Further challenges arise for these individuals because of mental health stigma in the workplace. This can cause more anxiety, depression and stress which can create a downward spiral.

The issues younger workers have been experiencing in the last decade have only worsened with the pandemic. Less mentorship and day-to-day social interaction have really affected youth. Unfortunately, many managers are not equipped with the skills to help them navigate mental health issues. This is simply because it wasn’t a major concern until recently. Some experts believe managers should have mental health training.

How is the COVID-19 pandemic affecting people’s mental health?

The main aspect of the COVID-19 pandemic that’s affecting people’s mental health is the lack of social interaction. A certain level of socialization supports adequate mental health. For the last two years, much of our social interaction is through technology which is not the same. In addition, our ability to see friends and family has been heavily restricted. Even when it’s permitted, there’s anxiety over the illness and abiding by the correct restrictions, which are constantly changing.

Another critical aspect of the pandemic affecting mental health is financial stress. Many people have lost their jobs or are subject to random lockdowns. For those who still have a job, fear of losing it can trigger mental health issues. In addition, many are having to sacrifice a lot to earn a living, such as health care professionals. There is also inflation happening in the Canadian economy which is causing food, gas, housing and other necessities to skyrocket in price.

Other aspects of the COVID-19 pandemic that impact mental health is globalization and readily accessible technology. Globalization has increased competitive pressure. With remote work, more people are eligible for jobs they weren’t before. As an individual applying for a job, you’re up against more people than you were before the pandemic. For those who have jobs, technology has made working from anywhere possible. However, tuning into work all the time can cause stress and reduce opportunities for other activities, such as relaxing, going for a walk or doing a hobby.

Embarrassment keeping Canadians from seeking financial help

The Canadian Payroll Association reported 36% of Canadians live paycheque to paycheque. In addition, an interesting study showed many Canadians made a New Years’ resolution related to their finances and financial wellbeing. Especially those aged 54 and under. Clearly, getting finances in order is on the minds of many. But if so many Canadians worry about money management, why aren’t they seeking help?

The main reason is an embarrassment and likely fear of judgment from those around them. Many people are also embarrassed and afraid to seek help for mental health issues. One-quarter of Canadians reported that embarrassment would stop them from seeking financial help when needed. In fact, many people experiencing a negative financial situation are less motivated at work. But more driven to find new employment. As opposed to being more likely to secure financial help or seek out strategies to manage money.

Canadians are optimistic about 2022 despite financial concerns

Canadians were not exactly excited about entering 2021 after the tumultuous 2020 year. However, it ended up being better than most expected. In a recent study by Ipsos, 46% of Canadians agreed 2021 wasn’t as bad as they thought it would be. In the same study, 67% of people reported they are feeling positive about the 2022 year. This is regardless of financial wellbeing, including high inflation and the rising cost of living.

These figures indicate Canadians are learning to live within the new parameters we’re facing. But even so, there are many things outside of people’s control financially. For example, inflation and higher costs of living. Even if you set a financial goal, like putting more into a savings account, you may not be able to achieve it due to the unpredictable nature of the economy. For right now, Canadians should place emphasis on what’s in their control. A good goal is improving financial literacy.

How can we help you avoid & reduce financial stress?

The bottom line is mental health and financial stress go hand in hand. By working on your mental health, financial stress can alleviate. Or, by gaining financial security, mental health can improve. Making a change in your life is always challenging, even if it’s a positive change.

Consolidated Credit is here to help achieve financial wellbeing. We understand going through financial issues is difficult, but we’re not here to judge, only to help. Reach out for a consultation today to begin your mental health journey.

Consolidated Credit Canada can help you manage your financial stress. Contact out financial experts.

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