By: Ross McMillan from Momentum Financial Planning

After another tough economic year, a spike in mental health issues has been exacerbated by job insecurity, remote work stress, the rising cost of living and the blurred lines between work and personal life. The reality is that money problems and mental health are deeply connected. Financial stress can trigger anxiety, panic, and even depression, making it difficult to manage day-to-day life.

During Mental Health Awareness Month, Ross McMillan from Momentum Financial Planning emphasises that taking proactive steps to enhance our financial security is a crucial first step toward improving mental well-being and regaining a sense of control.

McMillan provides some advice on how to break the cycle and foster a healthier balance between your money and your mind:

1. Recognise the link between money and mental health

Understanding that your finances are likely affecting your mental health is the first step toward breaking the cycle. Many people feel overwhelmed by debt, bills, and other financial obligations, but they don’t always realise the toll it takes on their emotional wellbeing. McMillan explains, "Acknowledging this connection can help you approach both your mental health and your finances with more clarity."

2. Create a budget – it’s about control, not restriction

Budgeting is often viewed as limiting, but it’s really about taking control of your finances. "A budget is a roadmap for your money," says McMillan. "By knowing where your money is going, you reduce the uncertainty that causes stress and anxiety." A well-structured budget can help you prioritise necessities, manage debt, and set aside money for savings - all while giving you peace of mind.

3. Seek professional advice early

Many people wait until they are in deep financial trouble before seeking help, but addressing these issues early can prevent anxiety from escalating.

"Talking to a financial adviser can help you develop a plan to tackle debt, build savings, and manage expenses," says McMillan. "Even the act of discussing your finances with an informed neutral party will provide some sort of relief – giving you a clear vision of the path forward.”

4. Access mental health support

Mental health professionals can help you navigate the emotional triggers behind your financial habits. "If anxiety or depression is leading to impulsive spending or financial avoidance, professional help can provide the tools to manage these behaviours," McMillan explains. “You should never hesitate to seek support. If you don’t address the psychological aspect of financial stress, the effects can be far-reaching and can compound quickly to create long-term issues, which can be extremely difficult to resolve.

5. Take small steps to regain control

When both your mental health and finances feel overwhelming, McMillan says it’s important to start small and work your way forward. "Focus on manageable actions, such as paying off smaller debts or setting a weekly budget for discretionary spending. These small wins can build momentum and give you the confidence to tackle bigger financial challenges."

Breaking the cycle for better wellbeing

Addressing your financial issues proactively will not only improve your bank balance but also contribute to better mental health. "When you understand the connection between money and mental wellbeing, you can take meaningful steps toward improving both," says McMillan. “Seeking advice, budgeting effectively, and accessing mental health support are all powerful tools that can help you regain financial control and provide a cushion for your overall mental wellbeing.”