Money troubles don’t just manifest as stress and anxiety. If you’re struggling to pay your bills on time or to knock out some of that hefty student loan debt, you could also find yourself in a depressive funk. And studies show that depression makes you more likely to isolate yourself from friends, to eat poorly and skip exercise.
For insights on how to break this cycle by facing your financial truth head on, we spoke with Julie Casserly, a certified financial planner and author of “The Emotion Behind Money: Building Wealth from the Inside Out.”
Why do money troubles cause some people to stress out and others to feel down?
Casserly: Perspective plays a big role. When people focus on the past, on the debts they owe and how much they’ve spent, they fall into a funk. It’s very easy to get depressed because it feels like you have no control over what’s already happened. On the other hand, high anxiety usually comes from focusing too much on the future—wanting to buy a new car or a house and not knowing how that’s going to happen. The best perspective is to be present in the moment.
How can we cultivate that sense of now-ness, if we’re feeling low?
Casserly: Look at your reality right now. Some people don’t open their credit card statements because they don’t want to see the numbers. But denial is just going to feed your depression. Commit to opening the emails or envelopes that have been piling up, and write down all of your balances. You don’t need to use a fancy software program—just a piece of paper and a pen is fine. Putting those numbers right in front of you means you’re looking at your current financial reality—maybe for the first time in months or even years. You have to do that if you’re going to get past the denial and depression.
Some fear they won’t be happy until the debt is paid off or they have enough money in the bank.
Casserly: I’ve found that’s really not the case. Most young people today have student loan debt, car debt, credit card debt, and they’re trying to save for homes or retirement or both. There isn’t some moment of having “enough” that lets you be happy. But if you have a lot of debt, one way to not get stuck mentally is to automate your payments. Set it up, then stop thinking about it every day.
Windfalls can be such a mood boost. Should we feel guilty spending those on ourselves?
Casserly: When you get windfall—a tax refund, a birthday gift, a bonus at work—put a portion of it toward your debt, a portion toward future savings and spend one-third of it in the here and now. Spending it all right now won’t help you in the long term and can stir up a lot of guilt. And if you spend too much energy on the past you’ll get stuck there mentally. So split the windfall between your past, present and future. Then you’re facing your financial truth while also claiming your small wins along the way and feeling good about them. I had a client recently who was paying $2,000 a month in debt repayment, and when she finished, I encouraged her to throw a debt-repayment party with her friends. Moments like that can be a huge mood boost and really empowering.