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Money commonly negatively affects people’s health, causing feelings like anxiety, stress and depression. For some people, it’s a persistent problem: Nearly one in three (29 percent) U.S. adults who say money has a negative impact on their mental health are impacted daily, according to a recent Bankrate survey.
When those money worries remain for weeks or months at a time, it may help to reach out to a financial therapist who can provide support. Over the past decade, more counselors specializing in financial therapy have begun to help people understand how finances affect their mental health and give them the steps to build better financial mindset habits for the future.
A financial therapist can’t manage your money for you, but they may be able to help you through the stress that can come from money. Here’s what a financial therapist does, and why they can be a resource when money affects your mental health.
Key Bankrate money and mental health insights
- Half of U.S. adults say their mental health is negatively affected by money. 52% of U.S. adults say money has a negative impact on their mental health, such as feelings of anxiety and stress, worrisome thoughts, loss of sleep or depression.
- Inflation’s effects are affecting mental health more year-over-year. 68% of those whose mental health is negatively affected by money cite inflation/rising prices. Similarly, 57% of those who said inflation/rising prices has a negative impact on their mental health say that concern has increased over the past year.
- More Gen Xers experience negative mental health effects due to money. 60% of Gen Xers (ages 43-58) say money has a negative impact on their mental health — the highest percentage of any generation. In 2022, 46% of Gen Xers said money had a negative impact on mental health — a 14 percentage point difference.
More than one third of millennials who believe money has a negative impact on their mental health say they worry about money daily
More than half (52 percent) of U.S. adults say money at least occasionally has a negative impact on their mental health, according to Bankrate. The largest percentage of them say it affects them daily:
- Daily: 29%
- Weekly: 27%
- Monthly: 25%
- Less often than monthly: 18%
Gen Zers (ages 18-26) and millennials (ages 27-42) are more likely to experience daily negative mental health due to money than older generations like baby boomers (ages 59-77). Around one-third of Gen Zers (32 percent) and 38 percent of millennials who say money has a negative impact on their mental health say they worry about money daily:
Note: Among those who say money has a negative impact on their mental health
In comparison, only 26 percent of Gen Xers and 22 percent of baby boomers who say money has a negative impact on their mental health say they worry about money daily. More baby boomers who say money has a negative impact on their mental health say they worry about money monthly (32 percent).
How a financial counselor can help with money anxiety
Turning to a financial therapist can be a way to find support when money is negatively impacting your mental health. The idea of a financial therapist is relatively new; one of the first self-described financial therapy organizations, the Financial Therapy Association (FTA), began in 2009 and started publishing studies that same year.
The trend of financial therapy has grown as more Americans generally begin to seek mental health care to learn new coping strategies for anxiety, depression and other mental health conditions. In 2021, 11.1 percent of U.S. adults were counseled by a mental health professional, according to the latest data available from the Centers for Disease Control and Prevention (CDC), up from 9.5 percent in 2019. The FTA’s database now has 80 members offering financial therapy or non-clinical guidance, specializing in subjects like receiving sudden money, insurance, layoffs, retirement, budgeting or trauma.
Financial therapists can break down financial stressors that may be affecting you, help unpack financial trauma and provide other therapeutic guidance. A financial therapist is typically not a licensed financial advisor and they may not have a fiduciary duty, meaning they won’t manage your money for you.
For Lindsay Bryan-Podvin, a Michigan-based financial therapist and coach, her role is less about guiding people through the nuts and bolts of how to manage a bank account and more to do with understanding emotions tied to money.
“A financial therapist really helps people at the intersection of how emotions, psychology and systems impact why they do what they do with money and to help them make choices that feel best for them about their personal finances,” Bryan-Podvin told Bankrate.
- Financial therapist
- A financial therapist is usually a licensed mental health professional who specializes in helping mental health symptoms caused by financial stress, as well as help clients budget or set financial goals. They may have additional financial training or certifications, though no one certification is required for someone to call themselves a financial therapist.
- Licensed Master Social Worker (LMSW) or Licensed Clinical Social Worker (LCSW)
- LMSW and LCSW refers to two different social work licenses, providing non-clinical or clinical social work services, such as therapy. Both licenses require at least a master’s degree. Additionally, LMSWs require an exam and LCSWs require two years of field experience.
- Financial advisor
- A financial advisor can help you create a budget or estate plan, manage your investments or guide you on when to take Social Security, among other hands-on financial duties. A certified financial planner is licensed by the Certified Financial Planner board and acts with a fiduciary duty, meaning they are legally required to put your interests before their own.
Bryan-Podvin was already a therapist specializing in anxiety and depression disorders when she began to feel underqualified to help clients with the emotional side of money. When she struggled with bills after graduate school, commonly available personal finance advice wasn’t helping.
“Every time I picked up a book, I felt like I was getting yelled at. It was, ‘It’s your fault you’re in this situation. You didn’t work hard enough. You didn’t save enough.’ And I’m like, I’m doing everything in my power,” Bryan-Podvin said. “I knew what it was like to be on the receiving end of incredibly individualistic and shame-laden personal finance advice, and I just thought that I was not alone in that.”
How much can you expect to pay for financial therapy?
Fees for financial therapy vary from provider to provider, just like other forms of therapy. Financial therapists are obligated to clearly disclose their fees and billing structure in the first meeting or session.
Financial therapy is difficult to provide under health insurance, Medicare or Medicaid, according to Bryan-Podvin, though it’s easier if the mental health practitioner can classify the therapy under a diagnosis like anxiety or depression.
If therapy fees aren’t in someone’s budget, they can seek credit counseling through a non-profit organization. Credit counseling can’t address mental health issues directly, but counselors often offer free workshops, education and advice to help manage money and debt.
Cost can lock low-income people out of financial therapy, but Bryan-Podvin says she’s seeing more financial and mental health resources become available to minority communities.
“Even if it isn’t a specific financial therapist, finding communities, whether it’s a Substack newsletter or a hashtag that you follow, finding people who can validate, emphasize and normalize your lived experience actually [helps],” Bryan-Podvin said. “You’re going to be like, ‘Oh, I’m not alone.'”
3 ways to organize your finances before seeking financial counseling
Considering starting financial therapy? First, it may help to take stock of your financial picture. Here’s how you can better understand your finances before of reaching out to a financial therapist:
- Create or update your budget. Write down your monthly bills, debt repayment, insurance and other expenses to get a gist of how you’re spending each month.
- Write down your debts and assets. If you have a credit card, student loan, medical or other debt, gather your accounts to understand how much you have in debt. It may also help to look into your assets, such as the value of your home, retirement accounts or savings. Your debt subtracted from your assets is your net worth, which gives you an idea of your financial picture.
- Consider your financial goals. It may be helpful to ask yourself why you’re examining your financial habits. For example, do you want to buy a house or get married? Or maybe you want to pay off debt? Creating a list of short-term and long-term goals can provide accomplishments to work towards.
Bankrate commissioned YouGov Plc to conduct the survey on financial wellness. All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 2,365 U.S. adults, including 1,232 who say money has a negative impact on their mental health. Fieldwork was undertaken April 12-14, 2023. The survey was carried out online and meets rigorous quality standards. It employed a non-probability-based sample using both quotas upfront during collection and then a weighting scheme on the back end designed and proven to provide nationally representative results.