Financial Stress: What It Is and How to Control It

Emotional stress related to a lack of money is known as "financial stress". Find out all about it in the following article.
Financial Stress: What It Is and How to Control It

Last update: 30 December, 2022

It’s no secret to anyone that during the last two decades, the cost of living has increased enormously. Coping with basic necessities, leisure, credit responsibilities, and more is becoming increasingly difficult. The consequences of this are very varied, and among them, what’s known as financial stress stands out. Although the literature on the matter has increased, the truth is that it’s a problem that has always existed.

Financial stress is more common in low-income households, although it can manifest in all social strata. This is a real phenomenon, one that’s also associated with multiple problems in general health. Today we’ll explain everything you need to know about financial stress and what experts know about its main causes and consequences.

The characteristics of financial stress

The emotional tension that arises through problems related to money is known as financial stress. Psychological stress is a natural response in order to cope with situations that are perceived as potentially dangerous.

When it’s activated, it leads to a series of physical and emotional alterations, which impact almost the entire organism. Episodes of financial stress are characterized by such disturbance, only that their triggers are economic concerns. Broadly speaking, we can speak of two different types of financial stress: Objective stress and subjective stress.

The first case alludes to the problems one has when dealing with day-to-day expenses and financial responsibilities. On the other hand, the second case is anguish, impotence, or frustration about not earning as much money as one would like (although in this case, it’s possible to cover basic needs and manage debts).

This is a global phenomenon, one that primarily affects low-income families (objective stress). Despite this, families living in high-income countries may be under greater pressure to earn more, which translates into episodes of the second type (subjective stress).

Almost everyone worries about money from time to time, so it’s important to differentiate when it’s financial stress and when it’s just a passing worry.

Certainly, when an episode of stress lasts longer than expected, affects the person’s well-being, and is characterized by intense symptoms, it ceases to be a natural reaction and becomes a psychosomatic disorder.

In this case, a psychosomatic disorder caused by daily or recurring worries about the money that one receives or the debts that must be paid.

In addition to the social stratum, experts have identified other variables that enhance situations of this type. For example, it’s much more common in women, single people (divorced, widowed, and so on), those with a lower level of education, and those without a stable income. It’s then a very complex phenomenon, one that, as we’ve seen, can have subjective triggers.

The consequences of economic stress

Financial stress affects quality of life.
Those who suffer from the consequences of financial stress see their quality of life greatly affected in almost all areas.

As researchers point out, the first consequences of financial stress are experiences on a family level. In other words, through fights, conflicts, accusations, resentment, and distance. This translates into a deterioration in interpersonal relationships with the partner or children, so much so that in many cases, it leads to family dissolution.

As we already warned, psychological stress has a direct impact on physical and emotional health. It all depends on the intensity and the time during which it’s postponed, but stress always affects you sooner or later. We’ll name some consequences in this regard below:

  • An increased risk of developing cardiovascular disease
  • Sleep disorders
  • Reduced immune capacity (which exposes you to a greater risk of infections)
  • Digestive system problems (constipation, diarrhea, and others)
  • Diabetes
  • An increased risk of developing immune disorders
  • Skin conditions
  • Hypertension
  • Headaches, nausea, and vomiting
  • Trouble concentrating
  • An increased risk of developing more acute emotional disorders (such as depression and anxiety, among others)

But this isn’t all. Financial stress has a direct impact on self-esteem, self-awareness, access to hospital resources, unhealthy behaviors, and even suicidal ideation. There are multiple planes through which this type of stress conditions your well-being, and the longer you expose yourself to it, the greater the consequences will be.

Tips to avoid financial stress

A woman shopping at the grocery store.
Knowing what the most important expenses are and having adequate planning are essential to face financial stress.

There are many ways to deal with financial stress. There’s no magic recipe, partly because the various variables that affect its development prevent people from being able to control them all. Despite this, the American Psychological Association (APA) recommends the following:

  • Make financial decisions progressively (so you avoid accumulating many responsibilities or expenses at the same time).
  • Track how much money you spend, how, and on what.
  • Identify the weak points of your financial management (unnecessary expenses, things that you can go without, and so on).
  • Make a monthly plan of the things you need as a priority to allocate your money to them (market purchases, rent payments, and so on).
  • Reduce the time you spend watching advertising on social media, television, etc, as well as the time you spend in shopping malls and places that encourage spending.
  • Only take with you the amount of money you require, and try to leave your credit card at home.
  • Identify what things you’re doing to deal with financial stress. Many tend to resort to alcohol, tobacco, and drugs; This further increases your monthly expenses.
  • Consult with family and friends before making a major financial decision.
  • Try to negotiate the possible debts you have.
  • Acknowledge that you have a problem.

As with other types of problems, recognizing that you have it is essential. You can’t implement these tips and do something about it if you’re reluctant to accept that you have such a problem. We’ve already seen the emotional and physical scars, so its effects aren’t just financial. Accepting the problem will also motivate you to seek help.

You can use your family, your friends, a financial adviser, or a professional psychologist as support for the stressful situation. The latter will help you channel the emotional aspect, and will give you strategies to deal with it. Don’t hesitate to ask for help if you think you need it or to apply the advice we have given you.

  • Friedline T, Chen Z, Morrow S. Families’ Financial Stress & Well-Being: The Importance of the Economy and Economic Environments [published online ahead of print, 2020 Jul 15]. J Fam Econ Issues. 2020;1-18.
  • Ryu S, Fan L. The Relationship Between Financial Worries and Psychological Distress Among U.S. Adults [published online ahead of print, 2022 Feb 1]. J Fam Econ Issues. 2022;1-18.

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