Six ways to manage your money and your mental health

Dani Skerrett

by , Senior Content Marketing Manager

at PensionBee

20 Sept 2022 /  

Sept 2022

Young black women sitting on sofa

Managing your personal finances can often come with many challenges, from making sure you have enough to pay for household bills and all your monthly expenses, to deciding how and when to save for the future.

With so much to think about when it comes to money, it’s no wonder that finances and mental health are intrinsically linked.

Founder of Psychreg; Dennis Relojo-Howell says: “When we’re thinking about money worries, there is a lack of realisation that there is a mental health aspect to it.”

A survey by Money and Mental Health found 86% of people said their financial situation had made their mental health problems worse. And 72% said their mental health problems had made their financial situation worse.

As the vast majority of the country continues to navigate the cost of living crisis, with soaring energy bills and an unpredictable economic climate, the time to take stock of your money and mental health is now. In England alone over 1.5 million people are experiencing problem debt (meaning they are in debt and unable to afford their repayments), and are suffering with mental health problems.

If you feel like you’re struggling, it’s important to remember that you aren’t alone and there’s help out there. The key thing to do is seek support if you start to notice that your mental health is deteriorating, whether that’s because of your financial situation or for other reasons.

If managing your money feels overwhelming, try taking things one step at a time - mental health charity Mind have shared a list of six ways to manage your money and mental health to help you get started.

1. Check if you’re eligible for any extra money or support

It can be difficult for many of us to navigate the benefits system, it’s complex and lengthy and in addition, many still feel there’s a terrible stigma attached to claiming benefits. This is due to the media’s portrayal and various misconceptions about why benefits are needed and what they’re used for. Even if you’re unsure whether you’re entitled to any support, you should never be afraid to check. The charity Turn2Us helps individuals access benefits, should you need some advice with what you’re entitled to and how to claim anything if you are.

2. Speak to someone you trust

Talking to someone you trust and sharing your concerns is often the first step to getting help when it comes to your mental health and wellbeing, and the same goes for money and mental health problems. This could be a loved one, a support worker or healthcare professional, like your GP. Ask someone you trust to check in on you from time to time, and do the same for them. Even when people seem well and don’t appear to be struggling, it never hurts to ask if they’re ok. If you’re unsure of who to talk to, there are lots of options - the Money and Mental Health website lists organisations that can help with money advice and further support services can be found on the Mind website.

COO at PensionBee and Mental Health First Aider; Tess Nicholson says: “The most important thing is to talk to somebody - whether that is the company that has sent you the bill or speaking to someone that can help with government support, or speaking to someone in your family.”

3. Get to know your money and mood patterns

You might find it helpful to take some time to think about how you feel about money and why. A good way to do this is to keep a diary and record how much you spend, and what on, as well as detailing how you felt before and afterwards. Looking back over your diary might help you understand your spending habits and patterns which could help when it comes to budgeting and planning for the future. The Money and Mental Health website has a budget planner that could provide you with a good starting point.

4. Change how you manage your finances

Overspending can happen for different reasons, and when you’re unwell you might spend more money than you want or can afford to, to make yourself feel better. But there are things you can do to try and curb overspending. This could be deleting shopping apps, making sure your card details aren’t saved on your devices and shopping websites, or giving your cards to someone you trust. Take a look at Money Saving Expert‘s wealth of tips to help with your overspending.

5. Make a list of monthly essentials

This could be things like rent or mortgage payments, energy bills, phone bills and food shops. It’s more important than ever to keep on top of paying your bills as the cost of living crisis in the UK worsens. With this in mind, it might be helpful to put all your important documents such as bank statements, bills and payslips in one place so you can easily access them when needed. You could also set aside a regular time each week or month to complete your financial tasks, like paying bills, and encourage yourself to stick to this by planning a relaxing activity after.

CCO at FSCS; Lila Pleban says: “Really look at your situation, and talk to somebody. Sometimes when you know the situation you’re in, it may not be as bad as you think it is. It may be, but at least you know.”

6. Seek professional help for managing any debts

If you’re struggling to pay off your debts, consider asking for help from a free professional debt advice organisation, such as National Debtline, StepChange or Citizens Advice. They can help you get a break from paying interest on your debts under a Government scheme called Breathing Space. You can access Breathing Space online, over the phone, or face-to-face and they’ll provide mental health support, as well as helping you look at your financial situation to see what solutions are available to you.

CCO at FSCS; Lila Pleban says: “Whether it’s your fuel bill, your telephone bill, if it’s your Sky bill, whatever bill it is, it’s important to talk to them, because many big corporations have charitable arms that can help out, some of them have grants available and often they have payment plans or cheaper tariffs.”

If you’re struggling right now and need to talk to someone, reach out to the SAMARITANS on 116 123 - they’re open 24 hours a day, 365 days a year.

You can also text the word SHOUT to 85258 to speak to a volunteer from Mental Health Innovations anonymously.

If you’re concerned about yourself, or somebody else, and you feel the situation is an emergency, then always call 999 to get immediate help. Or, alternatively call 111 if you’re looking for non-emergency advice during a period of mental ill health.

Mind are a mental health charity who provide advice and support to empower anyone experiencing a mental health problem. Visit their website, call their support line on 0300 123 3393 (lines open 9am-6pm, Monday-Friday) or, contact their community support.

Risk warning

As always with investments, your capital is at risk. The value of your investment can go down as well as up, and you may get back less than you invest. Anything discussed on the podcast should not be regarded as financial advice.

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