Research indicates that there’s a strong correlation between money problems and mental health issues. Spending more than we intend or budget has the propensity to create stress, anxiety and depression for many people. According to a UK study, 46% of people with financial problems have mental health problems, and 80% of people with mental health problems reported that financial problems have exacerbated their mental health problems. In a nutshell, how we manage our finances influences our mental well-being.
Not to put a damper on the festive season, but December in particular seems to be the month that we spend more than we plan. We are all in good spirits because it’s the end of the year, and we are planning our holidays, spending more on groceries and gifts as we prepare to celebrate the festive season. Of course, we work hard for our money and it’s necessary that we enjoy life because life in itself is not guaranteed. In Namibia, we are famously known for embracing the “keDecember” vibe – a term we have adopted from South Africa. Basically, the notion that we can obtain luxuries we couldn’t access during the course of the year – luxuries that vary from food items to gadgets or certain lifestyles for the period of December. Sometimes, we may even indulge in financial loans to substantiate our “keDecember” costs.
However, in doing so, it’s important that we are mindful of our spending habits as January comes with its own challenges. After embracing “ke December” many of us experience financial troubles. Usually, in January most households’ expenses include buying school uniforms and stationaries as well as paying school fees and transport costs. Realistically, we cannot cover these expenses if we don’t set money aside for it during December. By not planning well, we are setting ourselves up for mental health challenges and increased financial costs. To rescue ourselves from “January woes”, we are likely to take out additional loans, inadvertently causing more stress than we had, as loans are vicious cycles that keep us in debt longer than we anticipate.
When we understand our relationship with money, we can plan better by applying the following as suggested by Madeline Miles:
Make one decision at a time – money can be overwhelming but try to focus on one financial decision at a time.
Create and stick to a budget – it’s difficult to set goals if you don’t have a starting point. Analyse your finances and create a realistic budget and stick to it.
Monitor your spending – list all your spending, including the costs that you consider insignificant such as fast food.
Identify your financial stressors – what is the one thing that gives you anxiety or stress? Know that stressor and deal with it.
Recognise the emotions you feel related to money – pinpoint the emotions you experience in relation to money. Journaling can help with this.
Implement healthy coping mechanisms into your mental fitness plan – your mental fitness should be a holistic reflection of how you take care of yourself to cope with your emotions and stress. For e.g. setting aside a specific percentage of your income for black tax purposes and sticking to it.
Seek the support of a financial coach – a financial coach can guide you toward a sustainable financial management plan.
Talk to a trained mental health professional – speak to your therapist if you’re finances are affecting your mental health and vice versa.
Respect your money, spend it responsibly and enjoy good mental health. Wish you a pleasant festive season and a magical 2023.
* Justine /Oaes (Licensed Clinical Psychologist)