How financial wellness supports mental health

In Brief:

• Financial stress is a leading cause of anxiety in the U.S.
• Experts say having a financial plan reduces emotional strain
• Open communication about money struggles is key to healing
• Clarity around finances supports better decision-making and wellness

When people think about their weekly income, 401Ks, stock portfolios and savings accounts, they often don’t equate those figures with how they’re feeling.

Yet financial stress is a leading cause of anxiety in the United States. According to numerous studies, money consistently ranks among the top stressors in people’s lives. A  2015 study by the American Psychological Association found that 72 percent of Americans reported feeling stressed about money at least some time in the prior month.

Improved finances, decreased anxiety

There is a profound connection between financial fitness and mental health, notes Samantha Clark, CEO and general agent of the Center for Wealth Preservation, which has offices in Syosset and Hauppauge.

“When individuals have a strong financial foundation—whether that means eliminating bad debt, maintaining emergency savings, or planning for retirement—It often leads to reduced stress and greater peace of mind,” said Clark, adding that their advisors focus not just on dollar figures, but on building confidence and emotional resilience through comprehensive financial planning.

Following the market too closely can often give people a severe case of the jitters.

“Market volatility can trigger emotional responses, even among seasoned investors. It’s human nature to worry when we see our portfolios fluctuate,” Clark said. “What we emphasize at the Center for Wealth Preservation is that long-term investing is a journey—not a day-to-day scoreboard. We coach our clients to focus on their financial goals and time horizons, not headlines or momentary swings.”

For clients who closely follow the market, Clark recommends a diversified portfolio tailored to their risk tolerance and regular check-ins with their financial advisor.

“Emotional investing can lead to poor decision-making, so having a well-defined strategy and a trusted advisor helps keep emotions in check and decisions grounded in data,” Clark said.

Improving financial conditions can go hand-in-hand with improving emotional wellbeing.

“When someone is facing financial challenges, it’s important to meet them with empathy and a structured plan,” Clark said. “Our approach starts with understanding their current financial picture—income, debt, expenses—and then developing manageable steps to improve it. That could include budgeting, debt reduction strategies, or exploring how their money can work more efficiently for them.”

Recognizing that financial stress impacts emotional wellness, Clark and her associates encourage open communication and support a mindset of progress over perfection.

“Small wins can build momentum,” she said. “Often, just having a plan and someone in your corner can make a tremendous difference. We strive to empower clients not only with financial tools, but with confidence and hope for the future.”

Acknowledge the problem

People often don’t make the connection between financial and mental wellbeing, and even admitting there’s a problem is the first—and perhaps the hardest—step to resolution, notes Taynia Clarke-Vendryes, community relationship officer for Ocean Federal Credit Union in Oceanside.

“If someone is having financial difficulties and they can’t sleep, they’re not functioning at work,” Clarke-Vendryes said. “Denial is a part of it because they say: ‘Oh, one has nothing to do with the other.’ But they actually work hand-in- hand.”

Part of Clarke-Vendryes’ role is making clients aware of the connection.

“Take care of one, the other will fall into place,” she advised.

Money is linked to the aspects of everyday life, from the utilities in your home, to the food you eat and the gas in your car.

“So, they work hand-in-hand together, as you go about your daily life. And when your money isn’t right, your financial wellbeing is in trouble,” said Clarke-Vendryes, adding that regardless of your status of life, it does affect you.

She adds that talking about your situation is helpful.

“As we speak more openly about it, people become more comfortable accepting that, ‘okay, I don’t have to be ashamed of where I am,’” Clarke-Vendryes said. “’All I have to do is speak about it because there’s help out there for it.’”

Most importantly, people should not be embarrassed to ask for help.

“Too long we have been in our corners thinking we have all the solutions: We don’t,” she added.

Financial wellness reduces stress

Confidence and clarity around your finances are key to financial wellness, notes Daniel Shaughnessy, head of wealth management for Wilmington Trust, a division of M&T Bank.

“It means also the ability to handle today’s needs and plan for the future,” Shaughnessy said. “Money, aligned with your values and life goals, is critical in thinking of financial wellness. Reduced stress and improved decision making come when you have good, solid financial wellness.”

Shaughnessy advises a good financial wellness plan starts with clear goals and values, focuses on long-term thinking—not just short-term wins—and coordinates investments, taxes, estate planning and cash flow.

“If you have a clear plan in place, are comfortable with who your team is, and the execution of that plan, and all those decision points that go into good financial wellness, it reduces stress,” Shaughnessy said.

For example, when business owners have their own financial wellness in place, they can focus on the growth of their business, their client experience and the wellness of employees.