Coping with Financial Stress

Every day we are reminded that we are living in challenging economic times. With the cost of living increasing, you may feel worried about your finances and are struggling to make ends meet. Feeling all sorts of emotions in difficult times in normal. Many New Zealanders are struggling with money and experiencing financial stress at any given time. In July 2024, Te Ara Ahunga Ora Retirement Commission conducted a nationwide survey exploring how New Zealanders are feeling about money, in light of the cost-of-living pressures many are facing. The proportion of New Zealanders feeling financially uncomfortable remains persistently high at 56%. Additionally, more people are worried about their finances and debt compared to 2022.  This research is concerning given the link between financial strain and psychological health.

The psychological aspect of financial wellbeing, involves how we think, feel and act when it comes to money. Often, our beliefs about money are so ingrained that we are don’t realise they are there. A psychological framework of motivation, called Self-Determination Theory, suggests there are three key psychological needs that influence our behaviour:

1. A need for autonomy and control
2. A need for competence and mastery
3. A need for connection and relatedness

The degree in which these factors fulfil our psychological needs varies between individuals. Some of us may be more financially motivated by providing for our family (connection and relatedness) and others by saving for retirement (autonomy and control). However, having a sense of control over finances is linked to our innate psychological need for self-determination. Therefore, it is no surprise that worrying about money can take a toll on your mental health, physical health, and interpersonal relationships. Te Ara Ahunga Ora Retirement Commission found that 19% of respondents had problems with interpersonal relationships (partners, family or close friends) due to financial concerns.

Financial stress can lead to a variety of issues. It manifests differently for different people, but may involve:

• Difficulty sleeping or sleeping more
• Changes in appetite or weight
• Depression
• Anxiety
• Relationship issues
• Poorer work performance
• Physical impacts (headaches, chest pain, high blood pressure)

 

What can I do?

Taking small purposeful steps in the right direction helps us to improve our mental wellbeing and form long-lasting positive financial habits.

1. Share your financial worries with someone. As the research highlights, many New Zealanders are struggling with finances or will at some point in their lives. It is common to feel a sense of embarrassment or shame when experiencing financial issues. For many people, talking about their finances or money worries may be embarrassing. You may feel guilty or a sense of shame about needing support or feel like you want to hide your money situation. Often sharing your struggle can be the first step towards reducing your worries. Try talking to a friend, family member or a support service for financial or psychological help. There are plenty of free support services to take advantage of and get some great advice. Please see the help section below.
2. Identify and challenge your thinking traps. Cognitive distortions, otherwise known as ‘thinking traps’ are common for us when it comes to money. They are the unhelpful internal commentary that often come up during stressful times. For example, “I am always bad with money” or engaging in catastrophic thinking by spending time worrying about the worst potential future scenarios. What thinking traps come up frequently for you? Write them down and challenge them when they come up. For example, “Is this thought helpful?” or “Am I assuming the worst?”.
3. Create space to look at your financial situation. While it can be tempting to avoid looking at your finances, it is important to take action. Taking action helps us identify things that are within your control (internal locus) which helps us feel less vulnerable to the situation. Taking action also helps to close the gap between where you are now and where you want to be.
4. Maintain healthy habits and routines. Particularly during times of high financial stress, we need to maintain strong habits. When did you last eat a nutritious meal? When did you last get outside and move your body? When did you last have a good sleep? These tools are tried and tested but are often the first we let slip!
5. Go easy on yourself. Be aware of how you talk to yourself and treat yourself kindly. Your financial state does not reflect your value as a person, and over-identifying with your financial status can lead to further stress. Financial difficulties are the result of many factors, only some of which are under your control.
6. Make time for inexpensive fun! Focus on what you can control and what options are available for you. There are plenty of free things you can do. Spend time with friends or family, plan a picnic or pot-luck dinner, pick up a book for your local library or go for a walk along the beach.
7. Practice mindfulness or relaxation techniques. Try free yoga or meditation classes online. Listen to music or a mindfulness podcast. Take a short break in the day and practice deep breathing exercises.

 

Help:

There are free, financial mentoring and budgeting services available:

• co.nz – free helpline run by FinCap for debt and budgeting support. Call 0800 345 123 or visit fincap.org.nz to arrange a meeting with a financial mentor.
• org.nz – independent financial information, guides and tools.
• co.nz – financial information and advice.

The following services offer free support 24/7 and can connect you with others who. can help you:

• Free call or text 1737 anytime to talk to a trained counsellor.

• Depression helpline – visit www.depression.org.nz, call 0800 111 757 or free text 4202 (to talk to a trained counsellor about how you are feeling or to ask any questions).

• Lifeline – visit www.lifeline.org.nz, call 0800 543 354 or free text 4357 (HELP).

 

Stacey Dukes / Psychologist

I am an intuitive and compassionate Registered Psychologist who provides a safe space. I value creating a strong therapeutic relationship with my clients, which I believe is supported through my warm and authentic approach. I provide a therapy style that is relaxed, client lead and based on a shared understanding of reaching the goals that client’s find most meaningful. I understand that there is not a ‘one-size-fits-all’ approach and modify my approach according to the individual needs of the client. I work with young people (16 years or older) and adults. I am also a registered provider for ACC Sensitive Claims treatment.

Contact Stacey
[email protected]
https://mindgarage.co.nz/our-team/stacey-dukes/