Financial Stress and Tools to Help You Cope

I know the impact of financial stress on a daily basis. Most times, thinking about money makes me stay up all night. Before the pandemic, I was doing OK financially. I wasn’t able to live luxuriously, but I was able to save a little bit of money each month and occasionally treat myself and my daughter. Now, after the pandemic, money has become a constant stress.” — Small-business owner in Oakland, California

Painstakingly, the experience shared by this small-business owner is not uncommon.


According to one survey by Morgan Stanley, 78 percent of the respondents reported feelings of financial stress. The pandemic only exacerbated this issue as it brought to light  the massive inequities within the United States.

To significantly reduce — ideally, eliminate — financial stress, there needs to be an extensive public policy overhaul and a significant shift within corporate America.


While we all wait for this overhaul to occur, there are steps you as an individual can take to regain your financial health in the face of stiff circumstances.

I refer to these steps as financial wellness. Please note that these steps are not to minimize the racist, sexist, and other present inequities. Instead, these financial wellness steps are meant to offer encouragement in the midst of hopelessness.

What is financial wellness?

My preferable definition for financial wellness is the “doable steps one can take to elevate their financial health.”


Financial health, as defined by the Financial Health Network, is “the dynamic correlation of one’s financial and economic resources as they are applied to or impact the state of physical, mental and social well-being.”

There are three categories for financial health:

  • vulnerable
  • coping
  • healthy

In August 2020, the Financial Health Network published its annual Trends Report. The report showed that nearly two-thirds of people in the United States were financially coping or financially vulnerable. These people are struggling to spend, save, borrow, or plan in ways that allow them to be resilient and seize opportunities over time.

Most of us don’t need research to prove that struggling financially causes harm to your financial health and creates financial stress. We also don’t need research to prove that financial struggles, and therefore stress, have a direct impact on your physical, mental, and social well-being.

However, the research around financial stress and its impact may help you feel more validated as you navigate challenging financial situations.

What is the impact of financial stress?

The Financial Health Institute defines financial stress as “a condition that is the result of financial and/or economic events that create anxiety, worry, or a sense of scarcity, and is accompanied by a physiological stress response.”

Emerging research is linking financial stress to mental health. A 2014 study from Yale University explores the idea that some “mental health problems” are actually money problems.

Annie Harper, PhD, the anthropologist and researcher behind this study, noted that the majority of participants were in debt and were very stressed about it. Debt has a strong negative impact on mental health, and she suggested that if an individual’s financial problems were solved, other problems might be solved as well.

On a day-to-day basis, financial stress can have a negative impact on your money decisions. It can lead to extremes of overspending or underspending. Similar to food where one can emotionally eat or severely restrict their diet due to stress, the same effect occurs with money.

An individual may find comfort in “retail therapy” — mindlessly spending on nonessential items — or find relief in restricting their spending to the point where they go without basic necessities, limiting their food intake to save money. However, in the long run, both extremes can be harmful.

As stated earlier, there are top-down changes that absolutely need to be made to reduce the stress caused by expensive healthcare, predatory student loans, stagnant wages or salaries, and the ever-rising cost of living.

But what can you do to shift your situation while the folks in the ivory tower filibuster their way to change? How can you take back your power to reduce your financial stress, elevate your financial health, and feel good about your financial situation?

My suggestion is to include financial wellness into your everyday life. Just like you read Visitlegit for physical and mental wellness tips to have agency over your general well-being, there are steps you can take to create agency over your financial health.

What are financial wellness moves you can make?

If you work for an organization, the first place to start is to ask your people and culture team (sometimes known as human resources) about financial wellness benefits.

These benefits can include the following:

  • Earned wage access. This is the ability to access your wages or salary before your payday so you can pay for an unexpected expense.
  • Financial coaching. Some employers reimburse expenses for financial coaching.
  • Hardship short-term loans or grants. Some employers offer access to loans or grants for unexpected expenses that are beyond the coverage of earned wage access. These are either awarded as grants that you don’t need to pay back or as a loan at a very low interest rate — less than 5 percent.

Beyond these benefits, and if you’re self-employed, there are financial wellness steps you can take on your own to shift your situation.

These steps can include:

Negotiating credit card debt

This can be achieved through consolidation or simply asking to reduce your rate. You can check out a company called Hello Resolve that will help you consolidate your debt for free. The company’s co-founder, Michael Bovee, also has well-researched, informative YouTube videos on how to DIY consolidate credit card debt.

Indulge in money mindfulness

Money mindfulness is a practice of bringing awareness to financial decisions. Overspending and many forms of financial anxiety are a result of making unconscious money choices.

To practice money mindfulness, I recommend taking three deep breaths before making any financial decision. Bringing awareness to your money choices will reduce spending that you later regret and help restore a sense of calm when faced with scary financial decisions that feel out of your control.


Your financial health have an impact on both your physical and mental wellbeing. The data proves it, and soon policymakers and business leaders will understand.

However, I know it can be frustrating to wait for others to change to eliminate societal inequities. In the meantime, my hope is that these financial wellness practices give you the tools you need to regain agency over your life.

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