How Worrying About Money Can Affect Your Health

Effects of financial stress on physical health

While it is not surprising that money is the main source of stress for most people, this new research has found just what people can expect from their worries. A study from researchers at several universities found that stress related to accumulated debt has a strong correlation to pain and inflammation.

This research also showed that unsecured debt is associated with work-limiting disabilities. By age 40, 11% of people with accumulated debt experienced health conditions that limited their ability to work. Roughly 12% of these people experienced pain that interfered with their work. About 26% of these people also experienced pain, swelling or stiffness in their joints. The researchers projected that, by age 50, these figures would respectively reach 19%, 20% and 51%.

These findings are especially concerning considering debt is a common theme in American households. Credit card usage in the U.S. hit a new high with over $1 trillion in open balances. Moreover, about 44 million Americans carry student loan debt, which can significantly contribute to financial hardship. 

Effects of financial stress on mental health

Unsecured debt and other financial worries can also contribute to mental health concerns. In a 2022 Bankrate survey, 42% of respondents said concerns about their finances have negatively impacted their mental health.

Anxiety, depression and worrisome thoughts were among the symptoms the respondents said they’ve experienced. Debt, insufficient funds to pay for expenses, and issues with managing money were some of the factors behind these individuals’ increased stress levels.

People who are in debt are often willing to take on more hours at work to more quickly pay off their debt. However, these extra hours can result in overworking to the point of burnout, which can lead to more stress in a vicious cycle. For those whose work abilities are limited, the stress of not being able to work and earn more can compound their debt stress.

Ways to improve cash flow

If you’re stressed about money, consider the following ways to increase your cash flow.

1. Reduce your expenses.

While some monthly costs are necessary, such as rent or mortgage payments, groceries, and insurance, you can cut back on others. For example, while dining out – including a cup of coffee on your way to work – might not seem costly at the time, it can quickly add up.

To save some money, try meal prepping on the weekends. This way, you can avoid dining out, eat a healthier diet, and still have something quick to heat up after a long day of work. If paying your rent every month seems to be a stressor, consider getting a roommate to help you split the cost.

2. Consolidate your debt.

If you have credit cards that you’re not repaying on time, chances are you’re paying between 16% and 30% in interest. These payments can add up. With debt consolidation, you can combine multiple sources of debt into one monthly payment. This way, you’re only paying interest on one balance so you can lower your overall payments. In turn, you might be able to pay off your debt faster and start putting your money in other places.

3. Negotiate your salary.

About 39% of respondents to a CouponFollow survey said they believed their mental health would improve if they received a pay raise, while 26% said their physical health would improve if they took home more money. If your managers are singing your praises at work, consider asking for a raise yourself.

Think about the scope of your work and how it reflects your original job description. If you feel that your role or responsibilities have expanded, approach your employer with these thoughts in mind and a list of your accomplishments. The extra income from a raise could close some financial gaps or help you catch up on accumulated debt.

4. Consider your hobbies as potential income.

You might be able to turn some of your hobbies into income opportunities. For example, If you enjoy painting, sell some of your artwork on Etsy. If you’ve always wanted to write a book, publish an e-book. Once you’ve published your content, you’ll receive money from every sale you make. While not every hobby will generate significant income, your favorite activity at least stands a shot at lining your wallet.

5. Make a budget.

While a budget itself won’t make you money, it can benefit your financial outlook. With a budget in place, you can hone in on areas that are costing you money and figure out how to adjust your spending. Simply having a plan can effectively reduce stress.

You can also use a budget to identify ways to make better use of your money. For example, your budget could help you start saving for retirement and creating an emergency fund. It can help you feel in charge of your finances, which can ultimately do wonders for your mental health.

A healthy way to manage money

Finding the best way to approach your finances can sometimes seem overwhelming. On the other hand, taking intentional steps to manage your money can reduce your stress and improve your physical and mental health. Try to focus on managing the financial areas where you have the most control. This way, you can create and implement strategies that work for you – and help you feel accomplished as you see positive results.