Wallet Woes and Wellness: The Connection You Can’t Ignore

ByNathan Astle

This article was originally published in Psychology Today on May 19, 2025. Nathan Astle is a monthly contributor to Psychology Today.

Mental Health Awareness Month is the perfect time to examine the critical link between financial health and psychological well-being. These two aspects of our lives are not separate—they’re interdependent, often forming cycles that can either support or undermine our overall quality of life. Understanding how these two important aspects of our health impact each other is key to sustained wellness.

The Dual Reinforcement Effect of Financial and Mental Health

Due to the inherent link between financial and mental health, someone experiencing poor mental health may find it significantly more difficult to rationally or effectively make spending decisions. According to a survey from Beyond Finance, 25% of Americans admit they procrastinate implementing healthy financial habits like contributing to an emergency fund, forming a budget, or auditing spending habits, due to stress. Emotional strain often exacerbates financial avoidance or impulsivity and deepens psychological distress.

The reverse is also true. As people begin to improve their financial habits, improved mental health outcomes often follow. Both financial and mental health must be viewed in an integrated way.

Neurodivergent and Mental Health Diagnoses Shape Financial Experiences

Standard money management tools are not universally effective. Someone with ADHD may process money urges differently than a neurotypical person and require alternative approaches to traditional budgeting. A person with an anxiety disorder may project their emotional state onto financial concerns and perceive minor setbacks as catastrophic.

Recognizing and addressing these kinds of diagnoses can help people develop financial strategies that align with their cognitive and emotional patterns, rather than adopting one-size-fits-all systems that may be difficult to sustain.

Using Values-Based Decision-Making

Emotional regulation is essential to smart financial decision-making. High-intensity emotional states, such as panic and fear, make rational financial decisions challenging. For this reason, it can be helpful to develop a process to recognize and name emotions before taking action. Recognizing and naming emotions can help you understand your current state and separate out emotional thinking from rational thinking.

One helpful strategy involves identifying how a decision might look if it were guided by personal values rather than immediate emotions. Asking questions like, “How would I make this decision if I were in a calmer emotional state?” or “What support could help me make the best financial decision right now?” can help bridge the gap between reactive choices and values-based actions.

Reframing Financial Wellness

Our upbringing — whether familial or cultural — often distorts our perception of financial norms. Without open dialogue, people may internalize unrealistic expectations or feel shame about their financial reality. This shame frequently leads to secrecy and isolation, and limits opportunities for support and growth.

Here are the tips I share with clients to reduce shame and create lasting financial wellness:

  • Get comfortable with discomfort. Actively deconstructing the origins of shame is uncomfortable and requires intentionality. Begin working through the root of financial shame by asking questions like:
    • Where did these financial expectations come from?
    • Whose voice am I hearing when I’m feeling financial shame?
    • Are these feelings around finances consistent with my own values?
  • Seek a support system. Financial stress should not be managed in isolation. Find a trusted loved one to support you. Seeking input, inviting feedback, or simply naming emotional experiences to another person can help regulate emotions around money and combat isolation.
  • Own your story about financial shame. Shame thrives in isolation. You can fight back against shame by being vulnerable in safe places and speaking with others about money, budgeting, and debt. Open dialogue creates space for positive change.

Financial decisions should reflect personal values, not external expectations or emotional states. By the same token, there are ways to work to keep your mental health intact, even while you’re experiencing difficult financial times. While there is no perfect path, the journey to lasting financial and mental health requires vulnerability and self-compassion. Understanding the connection between the two is the first step toward better overall wellness.