Money is the number one source of stress for 44% of adults in the United States. Some may even suffer from money anxiety disorder (MAD), which is when someone routinely engages in self-destructive and self-limiting financial behavior.
This behavior is more than simply making bad money decisions. Rather, it is behavior that may result in significant consequences, including your health, relationships and work.
Note that money anxiety disorder is not an officially recognized psychological designation, and not yet published in the Diagnostic and Statistical Manual by the American Psychiatric Association.
Money and Stress Explained
It’s only natural that we worry about money as it is the means by which we acquire food, shelter and security. When there’s not enough money to meet these needs, worrying about it is a natural reaction.
A Consumer Finance Protection Bureau (CFBP) survey finds that 43% of U.S. adults struggle to make ends meet. What’s more, 34% of Americans reported experiencing material hardships within the past year. These hardships include being unable to afford a place to live, running out of food and being financially unable to treat a medical condition.
According to Bankrate’s January Financial Security Index survey, 60% of Americans don’t have enough in savings to cover a $1,000 emergency. In other words, they would be unable to pay for an unexpected car repair or a medical emergency without going into debt.
With such dire consequences, it makes sense to be concerned about money. But for some, the money anxiety they experience can be debilitating and cause considerable distress in their daily life.
Symptoms You May Have Money Anxiety Disorder (MAD)
Therapists have been studying what is informally known as “money anxiety disorder” for years. Symptoms that you may be suffering from MAD include:
Hoarding
Compulsive hoarding is when people find it difficult to let go of possessions that may seem insignificant to others. They may have so much clutter that it negatively affects their ability to use their living and working spaces. As we’ll see in the next example, some hoarders don’t hoard items; they hoard money instead.
Excessive frugality
Many people with money anxiety are so worried about having enough for living costs that they largely avoid spending money on themselves.
While frugality itself can be an admirable trait, it can also be damaging as some money hoarders might not spend on essential necessities like health care and home repairs.
Overworking
On the other end of the spectrum is overworking and feeling the need to earn as much money as you can. Workaholics may feel anxiety or depression based on poor money management or the fear of never having enough money.
Working too much can lead to an unhealthy lifestyle and even put stress on relationships.
Overspending
About 6% of Americans exhibit compulsive buying behavior, which is an addiction to spending. These compulsive spenders seek temporary relief from financial anxiety through the endorphin rush from shopping provides them. The relief, however, is short-lived and replaced by feelings of remorse and depression as the cycle continues to repeat.
Financial Incest
When an adult shares inappropriate financial information with a child, it is called financial incest. A common form of financial incest, also known as financial enmeshment, is when parents have their children answer phone calls from debt collectors.
Another form of this behavior is when parents share inappropriate financial details of a divorce. For example, a mother might tell her child that she can’t sign him up for music lessons because his father hasn’t paid child support.
Financial incest can lead to insecurity for the children and cause problems in adulthood.
Financial Infidelity
Financial infidelity is a term used to describe when one partner in a relationship withholds or gives false information to the other partner about what’s going on with the money. The problem is so common that a recent survey from CreditCards.com found that 19% of adults in live-in relationships have a secret checking, savings or credit card account.
Financial Enabling
Financial enabling occurs when family members overspend on each other. Many parents opt to pay the expenses for their adult children when it is no longer healthy for the parents or the children. This behavior can be damaging by risking the parents’ retirement funds while also preventing children from learning financial responsibility.
Financial Dependence
In stark contrast to enabling lies financial dependence which is when one person relies on the income of another person that is not related to their job. Being dependent on another person may turn to resentment.
Some of those who depend on someone else financially report feeling a loss of control and a lack of meaning.
Coping With Money Anxiety
Since money fears often derive from uncertain factors out of our control, such as a loss of income or medical emergency, it may be helpful to concentrate on completing tasks you can control. Saving more of your income and contributing more to your retirement, paying down debt and spending less money are a few ways you might positively impact on your finances and reduce money anxiety.
The amount of money you spend, and how you spend and save it are typically a reflection of your spending habits and behaviors. Many experts advise scheduling money dates to examine your budget and look for ways to make positive changes.
You may also benefit from consulting with a financial counselor or therapist to get to the root of any problems. If money problems are serious and seem insurmountable, a reputable expert or therapist may help you jump the hurdles and find financial peace.
If you would rather not seek professional help, talking to a close friend or relative can help you get comfortable talking about the issue and coming to terms with the seriousness of it. You might even ask this person to hold you accountable as you work towards a positive solution.
Bottom Line
While there’s no official designation in the Diagnostic and Statistical Manual V, it is a real condition that affects millions of people. Be aware of the symptoms above to help determine if you have a money anxiety disorder. If you’re unsure, a financial advisor or counselor may help you to better understand the issue.
It’s important to be able to function properly when dealing with something as important as your financial future. Take action to cope with anxiety and possibly lower money-related stress.
