Setting financial boundaries
Money and your mood- it’s all connected!
Mental health concerns may contribute to financial stress.
Financial stress may increase emotional struggles.
Let me elaborate…
Research indicates that about 90 percent of the 11 million people with serious mental health issues, such as schizophrenia, bipolar disorder, anxiety and depression, are unemployed.
About 3 million of these individuals are on public assistance, such as SSI or SSDI.
Full time employees miss over 8 days of work and part time employees miss over 13 days of work a year due to depression.
Roughly four to five days more than people who are not depressed.
People struggling with depression may struggle to complete school or pay their bills in a timely manner.
Individuals that struggle with their mental health are more likely to be in problem debt.
Sometimes, individuals turn to shopping to boost their mood.
Individuals in a manic state may spend impulsively.
Gambling addiction- enough said!
Having a mental health history may increase the cost of health insurance.
Those in debt or lacking financial resources will struggle to afford psychotropic medications, medical services, therapeutic services or other essentials needed to stay well, like food and shelter.
Being in debt is inherently stressful for many people, increasing feelings of anxiety, sadness and distress.
Shame or guilt regarding finances will only amplify these feelings.
Financial Boundaries are important!
Author Brené Brown defines boundaries as “what’s okay and what’s not okay”.
Your financial boundaries helps you understand and communicate what’s okay and no okay in terms of what you spend, save and give to others.
Benefits of Financial boundaries:
Protects your money
Protects your relationships with others
Improves your relationship with yourself
Benefits your mental health
How do you create financial boundaries? Start by establishing financial goals.
**p.s.** I LOVE S.M.A.R.T goals. It stands for:
S: Specific
M: Measurable
A: Achievable
R: Realistic/Relevant
T: Time limited
So, instead of saying “I will not overspend for the holiday” perhaps a goal could be “I will go holiday shopping this weekend at the mall and only spend $50 for each of my immediate family members”.
Specific? Yes! You know what you are going to do, where you are going to go, how much you will spend and which family members are getting gifts.
Measurable? Well, did you go shopping or not? How much did you spend?
Achievable? Perhaps! For example, if you had five members in your immediate family, it is possible to get the shopping done in one weekend at a mall **because you like to shop local :)
Realistic and/or relevant? Check and check!
Time limited? Yep, you know exactly when you plan to go shopping.
This is a great short-term financial goal! Think about other short, mid, and long-term financial goals you need to establish in your life. Focus on those goals that will help alleviate stress, which may help you feel a bit better in the future. These goals will help guide your behavior and point to the boundaries you will need to be successful.
What Type of Money Boundaries Could Help You Achieve Your Goals?
Create a budget for yourself and what you will spend on other people, causes or organizations.
Set a limit and stick to it.
Consider what you can afford to spend on yourself, for example entertainment, dining out and spending on hygiene and self-care.
Identify what you are willing to spend of friend and family for special occasions, holidays and special request
Consider what you want to spend on causes or organizations that are important to you
Do not open new lines of credit or add new debt if possible. Set limits as to the circumstances in which you take on new debt or how much new debt you are willing to accrue.
Think before you respond! If someone is requesting money, ask to get back to them later so you can think about your response.
Practice saying No. Practice having difficult conversations. Practice communicating your needs. Practice what you want to say with your friend, mentor, pastor, therapist or favorite nail tech. Find someone to help you practice what you need to say. Or don’t. But the difficult conversations still need to happen.
Prepare for the reaction and manage your feelings. People may be upset or dislike your decision. Others may try to push your boundaries or pressure you into something you are not comfortable with. Some people may be doing their best to advocate for their own financial needs. Regardless, you will likely feel guilty or uncomfortable with setting limits. Remember, your money-your rules! You are responsible for taking care of yourself and your wellbeing. Give yourself permission to do so.
Consider the resources below to help you develop better financial boundaries.
360 Degrees of Financial Literacy
Credit Abuse Resistance Education (CARE) Chicago
The Federal Reserve Bank of Chicago
Pennsylvania Housing Finance Agency
