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 Award-winning business author and broadcaster

Leadership trainer and coach

Keynote speaker

  • Writer's pictureAudrey Tang

Money and mental health

Updated: Jul 25, 2022

This article was developed from comments offered to the Press Association

How's your financial health?

The common direction for that question to go would be to check up on stocks, shares and portfolios, but our finances - whatever they may be - have a huge effect on our wellbeing. In this 21st century world, money (rather than power or strength, and even love to some degree) plays a huge part in our survival...and often in our motivations:

Money doesn't buy can buy people who like money

Money can sometimes be interchanged with love...this behaviour may be something that has been set down in childhood, for example, when parents who are too busy to spend quality time with children, instead spend money on them because gifts are one way of showing and receiving love (Dr Gary Chapman - 5 Love languages). Unfortunately, if a child has grown up in this environment, they too may enter adulthood using money in place of emotion - instead of offering support, they flake out but send flowers; if they let you down they don't apologise but they buy you a present; rather than doing something that takes effort - just buy it.

In many ways if the giver finds a partner who enjoys being gifted to, this can create a somewhat balanced co-dependency, but one might question if it is healthy, satisfactory or even meaningful. And, if this becomes a relationship pattern there is always a danger that the gifts (which do not really substitute for depth, intimacy and connection) may need to become more extreme in order for the relationship to last...this can lead to financial issues on top of emotional ones as the giver may - even without the resources to sustain it - feel s/he needs to continue to give rather than communicate and express in a healthier, deeper manner.

That ol' devil called dopamine

Another link between guilt and overspending is that shopping gives us a hit of dopamine. Dopamine, the reward chemical, is not discerning as to what it responds to...a rat whose dopamine pathway is stimulated can be encouraged to press a lever administering an electric shock and come back for more (...please note this is an OLD experiment and would not necessarily pass an ethics committee now).

If we have not learned healthy coping mechanisms to deal with stress, we may spend because it feels good - unfortunately putting oneself into debt is not a way to alleviate psychological woes.

Why do we make bad investments?

This can relate to the psychological hangover from evolutionary times when we were built to survive not necessarily thrive long term.

In the past, where our environment was dangerous with fragile alliances, it would have been healthy to take what you can now rather than wait until later...even though we know now, that smart investments can literally yield dividends...the world was very different. This instinct sometimes stays with us and research has shown that people would prefer to have a reward "now" rather than wait for a slightly bigger one a little later on. This is known as "the present bias". As such, when we are presented with something and we are told we must not "miss out", or it's a "limited offer", that bias can lead us to follow our fear of losing out rather than thinking critically about what is being offered...and spending money we do not have.

It is important to recognise that times have changed and therefore our judgments must as well. Now it is not necessarily a case of "Missing out", but rather "is someone trying to trick me"...and also "It's ok, another will come along soon". Holding on, or at least checking the facts can make a huge difference to us. In 1972 a longitudinal study showed that children who were able to delay gratification had better life outcomes in the long term, and while sometimes it is important to take action expediently, it never hurts to take a moment and check the facts.

Another problem surrounding bad investments is the "sunk cost bias" and that is the bias which leads us to think - I've already invested so much time/energy/money into this situation/job/relationship that I may as well keep going. Unless there are clear indications that something will change, it is often better to "cut your losses" before things get so bad that the change is forced upon you. At the very least, when we drive change, even if it is difficult, we feel empowered which can be motivating.

So what can we do?

As always, the first step is to recognise any behaviours that may be unhealthy. If you notice that you have a tendency to spend on others, ask yourself why you are doing it:

- are you hoping they will reciprocate?

- are you wanting them to like you?

- are you trying to make them do what you want?

- are you trying to make yourself feel better?

...there is nothing wrong with generosity, but consistent giving needs to be at a point when you have enough to spare.

Take practical steps:

Once you have identified the motivators to spend, explore whether that behaviour is effective or not. I personally was someone who was in a privileged position to "people please" through money, finding I was only attracting those attracted materialistically, and certainly not pleasing myself...the first step I did was when I bought a "new" car - I got a 2-seater so I would be actively prevented from offering lifts. ...and since that point, I have been a lot more conscious about who and what I spend on (finding my life is now much richer in affection!)

Work through the psychological drivers:

Removing the resentment on recognising money really didn't buy love (just the people who like money!) cleared headspace for me to explore the reasons for my behaviour. I did that through journaling - writing down when I behaved in a certain way and what it was that triggered it. This helped me think twice before taking action.

I also found that "substitution" helped - if money was going to "burn a hole in my pocket" - could I donate it to charity where I KNOW it will be appreciated, or even spend it on myself or my loved ones first buying something I knew I would need or a gift that would be saved for a birthday or special occasion. While the latter may sound a little selfish, don't forget, this is simply part of a larger process...and when it comes to the substitution, it would be a purchase I deemed necessary.

Reframe language

This is a strange one, but from being someone who always felt compelled to buy for others if I invited them out, I began outlining the cost at the point of organisation (while being considerate of budget)...this helped set a clear expectation for the event...and I certainly don't quibble over splitting a bill.


What helped me the most was a guided meditation visualising a "pool of abundance" - it is always lovely to visualise an overflow of money, but the speaker said something very significant: "You can invite others here if you wish, but remember, they have their own pool they can access too." What this allowed me to do was shift in my own mind that it's not necessarily about how much money people have, but that they have their own free choice in spending it...and so did I!

I am at the stage where I hope I haven't lost my generosity, but rather, I am more discerning where I spend it...perhaps I am retraining my dopamine pathway effectively!

Useful links:

Dr Audrey Tang is a chartered psychologist and author with a specialty in the "how to take action", rather than just giving explanation and advice. Listen to her podcast Retrain Your Brain here; and catch her practical masterclasses Psych Back to Basics on DisruptiveTV & Energy Top Up for resilience. For self development tools based within positive psychology: click Her YouTube Channel . Twitter/IG @draudreyt



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