How Getting Financial Advice Can Improve Your Mental Health

Mental health challenges and financial stress often go hand in hand. But, for many Australians, getting financial support isn’t a priority – even when it could improve their quality of life and mental wellbeing. 

In this article, you’ll learn exactly how financial and mental health affect each other, how getting financial advice can support better mental health outcomes, and how you or someone you love can use financial advice to break the spiral of poor health and poor wealth. 

The Relationship Between Financial Wellbeing and Mental Health 

Financial wellbeing and mental health are closely linked. When we experience financial challenges, we’re much more likely to feel stressed, which can affect us mentally and physically. But the reverse is also true – mental health challenges can make it harder to understand and improve our financial situation, creating a vicious spiral of poor health and poor wealth.  

In 2022, the Money and Mental Health Social Research Report (MMHSR Report) – commissioned by Beyond Blue and ASIC – found that there was a strong correlation between financial stress and mental health challenges. People who experience financial issues are twice as likely to experience mental health challenges, and people who experience mental health challenges are twice as likely to experience financial issues. 

The Relationship Between Financial Wellbeing and Mental Health
Image reproduced from the Money and Mental Health Social Research Report.

In the above image, we can see that this ‘vicious spiral’ can be triggered by financial factors (like being made redundant or having debt that feels out of control) and mental health factors (such as complex trauma or work-related stress). Think about how, for example, being let go from your job could lead to feelings of shame and low self-worth – or how stress could lead to overspending as a coping mechanism, which could impact savings and debt. 

The MMHSR Report’s findings aren’t unusual, either. The two-way link between financial stress and mental health has been corroborated by a range of peer-reviewed studies, which have found that poor financial wellbeing correlates strongly with conditions such as depression, anxiety, and general psychological distress [1, 2, 3]. 

One 2023 study, which analysed NHIS data of 22,682 US adults aged 18 to 85, showed a clear association between financial stress and poor mental health [4]. Importantly, that relationship existed regardless of the socioeconomic status, gender, or education level of the study participants [4].

How Exactly Does the Finance–Mental Health Relationship Work? 

It’s obvious that financial wellbeing and mental health are closely linked. But how exactly does the relationship work from a cognitive and emotional standpoint? Why does one influence the other so strongly? 

How Exactly Does the Finance–Mental Health Relationship Work
Image reproduced from the Money and Mental Health Social Research Report.

In the above image, we can see how the factors that influence both mental health and financial wellbeing outcomes fall into three domains: connection and community, confidence and capability, and choice and security. Negative financial or mental health experiences can adversely impact all three of these domains – which can trigger negative financial or mental health outcomes.    

Here’s an example. Let’s say your expenses have gradually exceeded your comfortable expenditure level. You’re working hard, you’re earning a good salary, but life is still getting on top of you – increased private school fees, an unexpected health complication, an investment gone bad.  

That could lead to feelings of insecurity about the future and being ‘trapped’ in a progressively worsening situation (choice and security). As those feelings increase, you become stressed. You snap out. You erode positive relationships in your life (connection and community). Low self-esteem affects your confidence at work, which impacts your earning capacity (confidence and capability). You begin spending more as a coping mechanism – and the spiral deepens.  

Professional Support Costs Money 

It’s also important to understand that getting professional mental health support does require some level of financial wellbeing. Under a mental health treatment plan, you can claim up to 10 individual and 10 group sessions with a mental health professional each year, which can be fully bulk-billed (depending on the professional) or partially covered under your plan. 

Unfortunately, patient wait times are now extreme – two-thirds of Australian patients have to wait more than 12 weeks to receive care, and 33% of psychologists are unable to take on more patients. While free services do exist, they’re generally limited in scope. (For example, headspace only works with young people aged 12 to 25 who meet certain criteria, while hospital treatment requires that patients have severe diagnoses.) 

As a result, poor financial health can also compromise your ability to seek mental health treatment, which can make breaking the spiral extremely difficult.    

How Financial Advice Can Improve Mental Health 

Cost and availability aside, professionals like psychologists and psychiatrists are the first place many people with mental health challenges go for support. They can help us work through negative mental health experiences to avoid further negative outcomes (physical, cognitive, emotional or otherwise).  

When poor financial wellbeing comes into the picture, though, it’s clear that we should be taking a more holistic approach. We now know that financial stress and mental health challenges feed into each other, and that negative experiences of either can kickstart the spiral of poor health and poor wealth. We also know that financial and capacity barriers can make getting professional treatment hard. 

With that in mind, it’s worth asking: how can getting professional financial advice complement professional mental health treatment? 

In the 2023 study we talked about before, the authors concluded that financial advice does have a big role to play in supporting mental health [4]. 

Financial practitioners […] should strive to understand the negative relationship between financial worries and mental health. Helping clients to better manage their finances and reduce financial worries and stress can potentially buffer psychological distress. Therefore, financial practitioners should adopt an integrated approach when their clients suffer from mental stress due to financial concerns. 

The MMHSR Report came to a similar conclusion. 

This research identifies ‘turning points’ in experiences that can be the catalyst for improvements in financial wellbeing and/or mental health, including intervention by friends and family, service providers, and employers. Participants often reported turning points occurring after ‘rock bottom’ moments and identified ‘upward spirals’ occurring afterwards, in which positive improvements in financial circumstances led to positive improvements in mental health and vice versa. 

Getting financial advice isn’t just a short-term Band-Aid. It can, for some people, be the ‘turning point’ that helps them break the spiral and get the professional mental health help they need. Even when financial stress stems from negative mental health experiences, seeing a financial advisor can support the treatment provided by a clinician like a psychologist or psychiatrist. 

People who do get financial advice agree. A 2021 survey by Fidelity International found that 50% of Australians receiving financial advice reported that their mental health improved as a result; 38% also reported that their family relationships improved (connection and community).        

A similar 2020 survey by IOOF analysed outcomes from 11,615 clients. Eighty-nine percent of clients said that getting financial advice allowed them to live their ideal lifestyles, 88% said it allowed them to be free of financial stressors, 95% said that it helped them have greater peace of mind financially, 92% said it helped them have greater control over their financial situation, and 90% said they had greater confidence making financial decisions.  

the top four non-financial benefits of getting advice

The same survey also found that the top four non-financial benefits of getting advice were:

  • Improved mental health 
  • Better family relationships 
  • Better social lives 
  • Improved physical health 

The top three emotional benefits were: 

  • Increased peace of mind 
  • Increased level of confidence in achieving their goals 
  • Greater levels of happiness 
Corrects Financial Stressors 

It’s clear that financial advice is extremely effective at improving finance-related mental health concerns. But why? How can advice from a finance professional enable better cognitive and emotional states? 

The first and most obvious mechanism: financial advice helps us improve our finances. It seems obvious, but it’s worth acknowledging. If your mental health challenges are solely caused by financial stress, removing that stress can, by extension, solve the challenges. 

Even if you’re experiencing mental health concerns that have a non-financial cause, reducing financial stress can help improve your distress tolerance, which may create space for better outcomes with your mental health professional. Being financially healthier also means that you’ll have the financial capacity to get the mental health support you need – which isn’t always possible under a standard 10-session mental health care plan. 

Eliminates Uncertainty 

One of the greatest contributors to poor mental health is uncertainty. Not knowing what the future holds – what challenges lie ahead and whether you’ll be able to overcome them – can exacerbate and even cause mental health complications [5]. Specifically, research has shown that there’s a strong link between financial uncertainty and worse mental health outcomes [6].    

While financial advice isn’t a crystal ball, it can help you understand your current financial situation and prepare for the future. For example, 91% of respondents in the IOOF survey stated that financial advice helped them avoid pitfalls, while 87% said it helped them secure protection against the unseen. Fifty-six percent also said that “less stress, anxiety and apprehension about the future” was one of the top two benefits they’d derived from financial planning.     

Builds Your Sense of Agency   

Sense of agency – the feeling that you’re in control of your thoughts, feelings and actions and their consequences – is one of the core drivers of happiness [7]. It’s what underpins other positive feelings like hope, self-esteem, and confidence. Loss of sense of agency, by contrast, is one of the most common reasons for people to seek out professional mental health support [8].   

Being financially disempowered can lead to feeling like you’ve lost control of your life. That doesn’t just include scenarios such as being let go from your job or being unable to manage your debt. People can also experience a loss of sense of agency when they think they can’t ‘get ahead’ despite working hard. (You’ve probably heard of ‘being on the hamster wheel’, which refers to working hard with no tangible results – a classic example of losing agency.) 

Talking to a financial advisor can help you rebuild your sense of agency by putting you back in the driver’s seat of your finances. By working with your advisor to develop a practical financial plan, you can go from feeling ‘swept along’ by life to actively moving towards your chosen goals. The Fidelity survey, for example, found that 86.2% of clients felt that financial advice gave them greater financial control, a feeling corroborated by 92% of the IOOF survey participants.       

How to Take the First Step   

By now, it should be obvious that getting financial advice can improve your mental health. But not all Australians think talking to an advisor makes sense for them – two of the most common objections are “advice is too expensive” and “I’m not wealthy enough to need financial advice”. 

Being wary about cost is normal, especially if you’re already struggling with finances. But it’s also important to understand two key points:

  • Your first meeting with a financial advisor is normally free. You won’t be locked into anything – it’s no different to a consultation with your GP.  
  • The cost of advice varies based on the complexity of your situation and the type of advice you want. For example, a high-net-worth individual who wants their advisor to manage millions of dollars in investments will be charged more than an ordinary Australian with a few thousand dollars in assets.  

Opportunity cost should also be a consideration. Instead of asking, “how much will this cost me?”, ask, “how much will I lose or fail to make if I don’t get advice?”. And, if you’re worried about your overall return on investment, look to the IOOF survey – of 11,615 clients, 84% stated that financial advice delivers more value than it costs. 

What about not being wealthy enough to ‘need’ financial advice? The myth that getting advice is only helpful for people with high incomes is simply not true. Financial planning is for everyone who wants to improve their financial wellbeing – and, as we’ve shown, it’s especially important for people who are experiencing mental health challenges. 

So, what’s the first step? It’s simple: book a free 30-minute consultation. That’s it. You can meet with your advisor, get an idea of how you can improve your finances, and then decide later whether you think further advice is worth paying for. 

Breaking the spiral starts with taking a step in the right direction. Try talking to an advisor – it could be the financial turning point you need.

Content on is for general informative purposes only and should not be considered or used as health or financial advice. For personalised advice about health or finance, talk to your healthcare provider or financial services provider respectively. 

If you or someone you know is in crisis and needs help now, call triple zero (000). You can also call Lifeline on 13 11 14 (24 hours a day, seven days a week), visit BeyondBlue, or find a suitable mental health professional here.


[1] Hamilton, H. A., Wickens, C. M., Ialomiteanu, A. R., & Mann, R. E. (2019). Debt stress, psychological distress and overall health among adults in Ontario. Journal of Psychiatric Research, 111, 89–95. DOI: 10.1016/j.jpsychires.2019.01.008 

[2] Drentea, P. (2000). Age, Debt and Anxiety. Journal of Health and Social Behavior, 41(4), 437–450.         DOI: 10.2307/2676296     

[3] Bridges, S., & Disney, R. (2010). Debt and depression. Journal of Health Economics, 29(3), 388–403. DOI: 10.1016/j.jhealeco.2010.02.003      

[4] Ryu, S., & Fan, L. (2023). The Relationship Between Financial Worries and Psychological Distress Among U.S. Adults. Journal of Family and Economic Issues, 44(1), 16–33. DOI: 10.1007/s10834-022-09820-9  

[5] Morriss, J., Tupitsa, E., Dodd, H. F., & Hirsch, C. R. (2022). Uncertainty Makes Me Emotional: Uncertainty as an Elicitor and Modulator of Emotional States. Frontiers in Psychology, 13. DOI: 10.3389/fpsyg.2022.777025 

[6] Tham, W. W., Sojli, E., Bryant, R., & McAleer, M. (2021). Common Mental Disorders and Economic Uncertainty: Evidence from the COVID-19 Pandemic in the U.S. PLoS One, 16(12). DOI: 10.1371/journal.pone.0260726 

[7] Welzel, C., & Inglehart, R. (2010). Agency, Values, and Well-Being: A Human Development Model. Social Indicators Research, 97, 43–63. DOI: 10.1007/s11205-009-9557-z 

[8] Yao, X., Dong, B., & Ji, W. (2022). Formulation and Clients’ Agency in Cognitive Behavioral Therapy. Frontiers in Psychology, 13. DOI: 10.3389/fpsyg.2022.810437