This week, in my series of posts on The Wheel of Wellness, I’ll be focusing on the financial segment. This aspect is all about living within your means and learning to manage your finances both in the short term and long term. I’ll be considering the impact that some mental health conditions may have on your money and will also be sharing some tips for managing your finances effectively, particularly if some of your issues are related to your mood.
What is finance?
Finance is concerned with the management of money and, on a personal level, includes activities such as spending, saving, investing, borrowing and budgeting. It’s about meeting your short and long term financial needs and living within your means, in other words, spending no more money than you have. To help you manage your finances, it’s important to become ‘financially literate’ which basically means having a good relationship with money and become well educated on the various aspects of finance.
Mood disorders and your finances
Most people dislike talking about money but it’s important that you develop your understanding of the different aspects of finance so you can keep yourself financially well. If, like me, you live with depression and/or bipolar disorder you will understand that managing your finances can be a source of distress, particularly during periods of mental illness. Although we all have different experiences, when depressed, you may find yourself struggling to make money decisions or deal with aspects of your finances. You might also try to make yourself feel better by spending money buying nice things. You could find yourself unable to work or have to take time off when you’re unwell and this can also make things hard. During times of mania or hypomania (very elevated or elevated mood) you may find yourself having frenzied spending sprees or making expensive purchases which you / your family can’t afford.
For example, during periods of hypomania, I tend to buy lots of things to fix problems e.g. neat or cute matching storage containers to create order and look good at the same time, the latest kitchen gadgets which I’ve spotted online, new blankets/cushions for our sofa to replace ones which are slightly past their best but we can manage with just fine etc. Also, everything in the shops seems to develop a rosy glow and is heightened in attractiveness and I have to stop myself buying it all. When I watch craft videos on YouTube, I need to have those exact pens in those colours shown, particular stickers or ephemera because it all looks so pretty or a certain gadget / crafty resource so that I can make similar things to those demonstrated. Then, when I get depressed, I get upset because my craft room is bursting at the seams with all of the things I’ve bought and I have no motivation to make anything or use any of my supplies.
Money management tips
If you think you would benefit from increasing your financial wellbeing, you might like to consider the tips I’ve put together below. Some are general tips related to learning more about your personal finances and budgeting, whilst others are specifically targeted at those of you who find that your mental health has a direct influence on your money management.
Know what your current financial status is
Spend some time getting to know your current money situation. Make a note of what is in your savings account, your current account and your ISA if you have one. Also, become familiar with your debts e.g. how much is left to pay on your mortgage?, what do you owe on any loans you may have? do you owe any friends or family some money? etc. Learn how much income you / your household have coming in each month and so on. You could create a spread in your bullet journal such as me and my money or create an e-record on your mobile phone.
Examine your cash flow
When you know how much you earn each month or how much you receive in benefits, find out how much you typically spend and on what. Try creating a tracker for income and expenditure for a month to get a better idea of your incomings and outgoings. You could also consider looking at your spending habits at different times e.g. when depressed, manic or hypomanic or when your mood is stable (neither high nor low).
You could do a paper version of this in your bullet journal or a notebook as shown below or you can use a free app which calculates your spending and deducts the money you from your monthly income. I found a couple of Android apps which were really easy to use by doing a quick search on Google Play.
If recording your expenses seems a little overwhelming right now, you could start by look at your monthly bank statements to see where your money is going each month. Although it won’t identify exactly what you purchased, it will tell you the name of the shop or business for each transaction.
Create a monthly budget
This is definitely something to do when you’re feeling well as it can be quite time consuming and requires good concentration and forethought. Once you’ve examined your cash flow situation you’ll know what your income is like and the kinds of things you purchase each month or each quarter. You’ll also know if you’re spending more or less than you have coming in and how much you are able to save (or not).
A monthly budget is a plan for how you will spend your money each month. It’s a popular way to manage your finances as lots of recurring expenses such as mortgage, rent, mobile phone etc. occur on a monthly basis. If you know what your income is each month, you can make sure you spend less than you have coming in. That way you can try to save a small amount of money with a view to creating an emergency fund for any unplanned spends.
There’s lots of information and advice online from money experts about how to create and stick to a budget but the key steps are outlined below:
- Calculate your monthly income – only consider consistent sources, not one off things like selling unwanted stuff on Ebay or money you get for your birthday
- Track your spending (see above)
- Consider your financial goals – this could be something like saving up for a deposit on a house, your wedding or a new car but could also be something small like reining in the amount you spend on clothes each month so you can put money aside for a holiday.
- Create your budget – make a list of all of the things you spend money on each month and allocate an amount to each category. This could include spending more or less on your favourite hobbies, cutting down on eating out and takeaways etc. A popular rule for creating a budget is the 50/30/20 rule where you allocate 50% of your income to needs, 30% towards wants and 20% towards savings.
- Continue tracking your expenses and refine your budget as and when necessary – do your spending habits align with your budget? have your financial goals changed? etc.
Identify your triggers
If your spending varies depending on how you feel, you might want to track your spending and your mood at the same time. Then, you can identify your triggers. For example, you may self soothe by shopping for little (or larger) treats in attempt to make yourself feel better when you’re depressed. You might overspend when you’re feeling high because each purchase comes with a little thrill or you have boundless energy for a frenzied shopping spree. Once you know your triggers, you can create a plan for managing them or seek advice and support from a professional.
Take steps to manage your spending
If you know your spending tends to get a little out of control during periods of mental illness, try to create a plan when you’re feeling well and maybe share it with close family and friends. This could include:
- leaving your debit / credit card at home and drawing out a limited amount of cash for your shopping
- shop with a friend or family member who can rein in your spending. You may argue against their recommendations, but ask them to persevere!
- get rid of your credit card altogether so you can’t spend money you haven’t got
- ask you ‘shopping partner’ to encourage you to think it over before making a decision to purchase. Is the urge to buy still there is a few days time or after you’ve slept on it? Most overspending is caused by impulse purchasing which you are likely to regret later!
- if you think you might be about to have an online shopping spree, try to distract yourself with something else which makes you feel good such as reading a book, doing some work in the garden or tending to your houseplants, having a relaxing bath or doing some yoga
Set up direct debits
During periods of difficulty you may have little energy or motivation to pay bills or manage your finances. Setting up direct debits (instructions for your bank to authorise payment when they’re due) for your monthly and quarterly bills such as your broadband, mobile phone, energy, council tax etc. makes things easier and safer and ensures you don’t forget to pay and become in arrears.
Seek medical help
If you feel your money issues are related to your mental health e.g. spending to cheer yourself up when depressed or going on manic spending sprees when you feel high, try talking to your GP, CPN or psychiatrist. Your GP should be able to refer you to the mental health team or your psychiatrist may tweak your medication or advise you upon therapy which may help to manage your symptoms.
Get free professional advice
If you live in the UK and are currently in debt you can get free advice from a number of places such as Step Change, Turn2Us, National Debtline and most people’s favourite money saving expert Martin Lewis. You can also seek our information of different benefits which may be available to you. Bipolar UK is a good source of advice and their website also has a selection of stories about money issues and a section dedicated to finances in their forum.
Ask for help from a loved one
Depending on the severity of your issues, you may just need to ask for help from your partner or a trusted friend. You can ask them to monitor your spending and intervene when necessary e.g. helping you to organise pay your bills when you’re depressed or look after your credit and debit cards during periods of mania or hypomania. You can also ask them to look out for changes in your behaviour related to spending during periods of mental illness.
Check out supportive webpages and sites
There’s a wealth of information available online relating to finances and there’s some particularly useful bits and pieces about money and mental health. Here’s some I found following a quick search:
- Moneyhelper.org.uk – beginners guide to managing your money
Coping with financial worries and debt
If you have money worries right now you may struggle to control your emotions and have feelings of guilt, shame, stress, embarrassment and exhaustion. This can lead to low mood and worsening of your mental health. You may be tempted to bury your head in the sand and hope that things will get better at some point but, although it might be really difficult and overwhelming, you should try to take control and find a way forward (easier said than done I know). Many people are currently struggling with managing their finances but there’s lots of help out there in the community and online so you’re definitely not alone. Also, remember the saying a problem shared is a problem halved. If you thought a good friend was having money issues you would want him or her to reach out and not feel ashamed of their situation so try to be self compassionate and seek some help and support.
Ultimately, managing your personal finances depends on all kinds of factors including your income streams and how steady they are, your employment status e.g. student, self employed, unemployed etc, your current non-negotiable monthly outgoings such as your mortgage or rent payments, your savings and how much you wish to increase them by if at all, any benefits you are entitled to, your dependents and your financial goals. However, if you dedicate some time to assessing your cash flow by examining your income and expenditure then you will become better educated with regard to your current situation and this will help you to manage your budget. By learning about the link between mental health and money you can identify your own issues and seek help with them, either from resources online, friends and family or professionals.
I hope you’ve found the information contained within today’s post helpful and it has encouraged you to think about getting on top of your finances if you feel it’s an area of your wellbeing that you might like to work on.