Americans Are Suffering Financial Burnout (C1)

The Littletons are far from being the only family experiencing this type of financial stress. Financial insecurity is degrading Americans’ mental health, according to a recent study by MarketWatch Guides shared exclusively with Newsweek. Even though inflation has eased considerably compared to its June 2022 peak, nearly half (47 percent) of respondents to a survey conducted by the financial news and market data company said that 2024 has been the most stressful year of their lives, money-wise.

‘Financial Fatigue’

Eighty-eight percent of respondents said they feel some level of financial stress, and 65 percent said their finances are the biggest source of stress, which is having a significant negative impact on Americans’ mental health.

Among those surveyed, about 41 percent even said their finances have „destroyed” their mental health, and nearly two-thirds of respondents (64 percent) to the MarketWatch survey reported feeling „financial fatigue”—a sense of burnout or exhaustion when dealing with money matters.

Manifestation of financial stress isn’t only emotional: symptoms reported by respondents include loss of sleep (56 percent), physical fatigue (47 percent), headaches (45 percent), weight gain or loss (38 percent), changes in appetite (34 percent) and digestive issues (33 percent).

„As the cost-of-living crisis continues to impact households across the country, many people who are already struggling will be finding their finances increasingly difficult to manage,” Liz Hunter, director of Money Expert, told Newsweek.

„While some on low incomes may have become accustomed to dealing with debt and financial uncertainty, the current crisis has also meant that there are many people experiencing financial difficulties for the first time in their lives.” This may be the case for the Littletons, who, when facing bigger bills, had to give up what Stephanie calls „certain ‚lifestyle-creep’ extras like meal deliveries, gym memberships and house cleaners.” As regular exercise is known to have a positive impact on both physical and mental health, Stephanie said that her family is „lucky to have access to public hiking and biking trails.”

More Bills, More Problems

But what exactly is stressing Americans out? Some 57 percent of respondents to the MarketWatch survey said the cause was the high price of essential goods; 47 percent pointed to their lack of savings and 46 percent to their lack of income. Meanwhile, 37 percent blamed their debt and 39 percent the performance of the U.S. economy. Thirty-six percent said that the high cost of housing was causing them stress, while 33 percent pointed to high interest rates.

Dealing with such a stressful situation and the anxiety that this can trigger has led many Americans to avoid handling their finances entirely. Some 44 percent of respondents to the MarketWatch survey admitted that they will ignore a financial problem until it becomes a crisis. But avoidance and neglect can further corrode an individual’s vulnerable financial situation.

A significant percentage of respondents to the survey admitted to bad financial habits triggered by the stress they’re experiencing. Some 58 percent said they do not use a detailed financial budget; 57 percent procrastinate on important financial decisions; 44 percent overspend to deal with stress; another 44 percent make purchases they cannot afford and 41 percent avoid opening bills or reviewing card statements.

Hunter, of Money Expert, recommends making it a priority to check your accounts. „It might seem like an obvious one, but regularly checking your bank accounts means you’ll know exactly what’s coming in, what’s going out, and what you can afford to spend right now,” she said. „Even better, it means you can stop problems in their tracks; whether that be fraudulent charges or simply being a little too close to your overdraft (and the fees that come along with it) than you’d like.”

Americans often feel alone experiencing these painful situations, with 58 percent telling MarketWatch that they hide their financial stress from loved ones. Following the pandemic, Americans were hit by a cost-of-living-crisis triggered by skyrocketing inflation, which in June 2022 reached a high of 9.1 percent—far from the Federal Reserve’s goal of 2 percent. In May, the latest data available, the consumer price index was 3.3 percent higher than a year earlier though remained flat compared to a month before.

Gasoline prices, up 2.8 percent in April, went down by 3.6 percent in May. Yet although inflation has come down, and appears to be continuing its downward trend, interest rates and mortgage rates remain high, keeping housing costs up. In May, the cost of shelter shot up by 0.4 percent, according to the latest data, suggesting that homeowners and aspiring homebuyers are struggling. The price of food has also increased by a modest 0.1 percent in the same month.

Economic problems remain high on the list of concerns troubling Americans ahead of the November presidential election. In its latest survey, Gallup found that 36 percent of Americans thought that economic problems were the most important issue facing the country today, with 17 percent worrying about the state of the U.S. economy in general and 12 percent about the high cost of living.

Another Gallup survey released in May found that a growing share of Americans (41 percent) said that inflation was the most important financial problem facing their family today, up from 35 percent in 2023 and 32 percent in 2022.

The latest results collected between May 1 and 23 for Gallup’s Economic Confidence Index, which indicates how Americans feel about the current economic conditions and their outlook for the economy, showed that confidence in the economy is plunging despite recent positive news. Forty-six percent of Americans thought the U.S. economy was „poor” in May, up from 44 percent in April and 39 percent in March. Only 22 percent found the economy to be „excellent” or „good.”

What To Do if You’re Struggling

David Atkins, a certified credit counselor at the National Association of Congregational Christian Churches, has three simple rules to avoid feeling stressed about money. One, identify expenses and make a plan. Gather all of your actual expenses and develop a spending plan where you break down your expenses by category (home, transportation, food, entertainment, clothing, debt payments etc.) so you know exactly how much money you should budget for each one. Two, use cash for daily expenses. The psychological effect of paying with cash can help encourage spending restraint. And three, pay off credit cards as quickly as possible. Credit card debt often carries much higher interest rates than other types of loans, so not avoiding a balance can be a significant cost (and worry) saving.

People struggling to keep up with payments to their creditors could consider trying to negotiate reduced monthly repayments or ask to be put on a payment plan, Hunter, of Money Experts, suggested. „To do this, you’ll need to show them why you can’t afford the current repayments. They’ll usually want to look at your total income, monthly outgoings and essential living costs to see what you’re able to realistically afford. However, this could affect your credit rating, and it may be harder to get credit in future,” she said. Those struggling to repay multiple debts with high interest rates might also want to consider consolidating their debts. „This means that instead of having to make multiple payments each month, you could get one large loan to pay everything off, leaving you with just one payment to make each month. Debt consolidation makes managing [debts] easier,” Hunter said.

„However, it’s not always the best option. Some come with added costs like origination fees, balance transfer fees on credit cards, closing costs and annual fees,” she added. „If you have a poor credit score, you may only get loans with high interest rates too, so it could end up costing you more in the long run. When shopping for a lender, it’s important to make sure you understand the contract before you sign up.”

You’re Not Alone

But getting your finances in order can be daunting when that very same task fills you with dread. Psychologist and certified financial therapist Dr. Traci Williams said that people who are battling with financial stress should remind themselves that they are not alone in their struggle. „It can feel isolating because other people around you may not be openly sharing the details of their financial lives,” she told Newsweek. But experiencing financial stress is, as the MarketWatch survey showed, pretty common.

The easiest way for people to get themselves out of this thorny situation is to face the issues up front, figuring out a solution. „Imagine a positive outcome to your financial situation. Ask yourself what that would look like and what steps you might take to get closer to that vision. This can help motivate you to make changes,” Williams said. „Make a list of steps that you need to take and start small. Facing a mountain is less daunting if you focus on taking one step at a time,” she added. „Get support from others. This might mean talking over your worries with friends or family members, or working directly with a credit counselor or financial counselor. You do not have to figure this out on your own.”

Acknowledging the emotions that people are experiencing—whether that is fear, anxiety, sadness, frustration or something else—is also a good way of steering clear of developing unhealthy ways of coping with stress.

„Avoid trying to push these feelings away and instead just notice them and know that they will pass,” Williams said. „Taking action can help prevent you from becoming stuck in your negative emotions. Focus on the control that you do have.”

SŁOWNICZEK

financial insecurity – niepewność finansowa

money-wise – w kwestii finansowej, w odniesieniu do pieniędzy

physical fatigue – zmęczenie fizyczne

interest rates – stopy procentowe

vulnerable – bezbronny, wrażliwy, czuły

procrastinate – odkładać, odwlekać (zrobienie czegoś)

fraudulent charges – nieuczciwe opłaty, nieautoryzowane obciążenia rachunku

overdraft – debet (przekroczenie stanu konta)

consumer price index – wskaźnik cen towarów i usług konsumpcyjnych

plunge – spadać gwałtownie

credit counselor – doradca kredytowy

keep up with payments – terminowo spłacać raty kredytu

monthly outgoings – miesięczne wydatki

credit rating – zdolność kredytowa

origination fees – opłaty początkowe

daunting – trudne, zniechęcające

dread – strach

thorny situation – drażliwa kwestia

Task 1

Listen to the recording and answer the following questions:

1. Why did Stephanie and Paul Littleton move from California to Texas?

2. What jobs do Stephanie and Paul currently have? 3. How has the financial situation of the Littletons changed over the years?

4. What impact has financial stress had on the Littletons’ mental health and relationships?

5. What are some physical symptoms of financial stress reported by survey respondents?

6. What are the main causes of financial stress according to the MarketWatch survey?

7. What advice do experts, such as Liz Hunter or David Atkins, give for managing finances?

8. What does Dr. Traci Williams recommend for those struggling with financial stress?

Task 2

First, match the words to form collocations and verb phrases that will help you describe the issue presented in the article. Next, write down a sentence using each collocation and verb phrase. The sentences you create should relate to the topic being discussed in the text. (See Key)

Collocations:

financial

cost-of-living

daily

monthly

essential

credit

annual

high

living costs

expenses

interest rates

insecurity

rating

crisis

repayments

fees

Verb phrases:

live

develop

break down

pay off

consider

face

figure out

take

a solution

expenses

consolidating debts

paycheck to paycheck

one step at a time

credit cards

a spending plan

the issues upfront

Task 3

Task description: Students will participate in a discussion about financial stress and its impact on mental health.

Task elements:

1. Recall the financial situation of Stephanie and Paul Littleton. What challenges are they facing?

2. Discuss how inflation and high living costs impact families’ mental health.

3. Break down the different ways financial stress manifests in people’s lives. Which of these symptoms do you think are the most severe, and why?

4. Propose a plan to help a family like the Littletons manage their financial stress better. What steps would you include, and why?

Task 4

Complete the following summary using information from the text.

Stephanie and Paul Littleton moved from California to Texas for better 1) __________ and now earn more money. However, they still live paycheck to paycheck due to 2) __________ and support their children financially. Financial stress has affected their 3) __________ and relationships. Many Americans share similar struggles, with high prices, lack of 4) __________ , and debt causing stress. Experts suggest budgeting, using cash, and paying off credit cards quickly. Seeking support from friends, family, or 5) __________ can help manage financial stress and improve mental health.