Canadian financial therapists on how to deal with the stress you feel over money
Author: Leah Golob
Source: The Toronto Star
While Sabina Wex is comfortable in her career as a freelance writer and podcast producer, she still experiences financial stress each month wondering if she’ll be able to pay the bills.
“Rent and the cost of living outside of rent is very expensive,” Wex says. “Sometimes your Visa bill is just as much if not more than your rent.”
In her case, Wex relies on Visa for all expenses outside of rent to keep track of spending and earn cash back. She also has financial fears around not paying bills on time, and dealing with what the consequences of that might be, such as having her hydro turned off.
“I’m afraid I’ll go from having a normal life to being totally destitute,” she says. “I get really catastrophic about it.”
According to FP Canada’s Financial Stress Index published in early June, Wex isn’t alone.
For the fifth time in eight years, Canadians surveyed by Leger, on behalf of FP Canada, say money is their top source of stress (38 per cent) — far more worrisome than personal health (21 per cent), work (19 per cent) and relationships (18 per cent).
Rising gas, grocery and housing costs along with interest rate hikes all contribute to stress levels, the survey reveals. And the consequences can be serious with one-in-three reporting that financial stress has led to anxiety, depression and other mental health challenges.
Financial therapy is one method professionals use to help clients with both their money and mental health. The Financial Therapy Association says it “helps people think, feel, communicate and behave differently with money to improve overall well-being through evidence-based practices and interventions.”
The Star spoke with three professionals who practice financial therapy on how to spot money stresses and how to alleviate them.
Alaphia Financial Wellness proprietor Natasha Knox, a financial planner who uses this type of therapy in her business, says money stress looks different on everyone, but can often appear as either avoidance or obsession.
“Sometimes when finances get overwhelming, people pull away and don’t want to look or think about it. They start to ignore the situation,” Knox says. “For other people, it can look like obsessing, like repeatedly checking the balance on their investments. It can also lead to trying to Google their way into answers on topics that may be unanswerable.”
These include questions like, “how much higher will inflation go? How much lower could the stock market go? When will gas prices come down? Should I wait to buy real estate or buy now?”
In between the extremes of avoidance and obsession, financial stress can pop up in other ways, says Knox, such as arguments or focusing on someone else’s spending.
The way financial stress shows up depends on how someone deals with emotional pain, Knox says.
“If you take the word financial out of it, it’s another form of stress,” Knox says. “My suggestion would be to look at what is working in other domains of their lives for managing stress. That would be a starting place.”
For some, that’s being out in nature, she says. For others, it’s practicing mindfulness and gauging if your thoughts are in the present or some imagined future. Often, stress can arise from past trauma or envisioning future events that you can’t control.
“It’s important to focus on what is within your control that you can fix,” Knox says.
If the markets are stressing you out, then it’s time to cut how much time you spend pondering your investments. Creating or tweaking a financial plan can also be a way to work through the stress.
Amanda Mills, a financial therapist at Loose Change Inc., tries to help clients avoid getting caught up in equating their sense of security or freedom with money. These kinds of attachments can lead people astray because they’ll overwork to earn money for “freedom” but never experience freedom because they’re too tied up working.
One thing she’ll teach her clients to say is: “money is simply money.”
“Try not to think of it as your worth or that your success all rides on it,” she says, which is tough in a culture that values money. For clients feeling stressed, Mills recommends they hit pause before slashing their spending.
“When people get panicky about money,” Mills says “they try to cut back everywhere instead of sitting down for a moment and figuring out how bad the problem is.
“I’ve seen people with a big problem try to tackle it by just cutting back on groceries and then they never get the groceries they like and they never get to solve their financial problem,” she says. “Until you know that number it’s really hard to correct it.”
One of the first things people often cut is their guilty pleasure — items that are negligible in the grand scheme of things, Mills says.
“I had a client who loved a certain kind of cheese and felt that times were tight and they couldn’t have the cheese anymore. When we looked at the cost of the cheese it was an extra $50 per year. It wasn’t a big deal. So have the cheese.”
Brenda St Louis, a certified money coach and financial therapist at Rewire, says one of the best ways to get a handle on financial stress is to just talk about it.
“There’s so much secret and taboo around money,” says St Louis. “People don’t talk about their financial stress with people and there’s a lot of posturing that everyone’s OK.”
One of the most powerful changes she sees with clients is when they talk with peers about what they’re doing with their money so they can learn from each other and share their struggles. Since everyone feels so alone with their money, it can crease a sense of being in it together.
“Stop hiding your financial life from others,” she says.
For Wex, learning to be more open about her fears around money has lightened the load.
“I think that’s helped relieve a lot of financial stress because you realize everybody’s worried about it or maybe you’re doing the same as others or not as bad as you think you are,” Wex said. “You don’t actually know what’s going on in people’s bank accounts unless you talk.”