Are Depression and Spending Money Related?

Written by: Ankita Kathad – MA (Psychology)

Last updated date : September 29, 2022

Table of Contents
Article title – Managing irritable bowel syndrome
  1. Chapter 1
  2. Chapter 2
  3. Chapter 3
  4. Chapter 4
  5. Chapter 5
  6. Chapter 6
  7. Chapter 7
  8. Chapter 8

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Often people spend a lot of money when they are sad or emotional. We have seen people shopping a lot after a bad breakup. A lot of times, people often buy items that they don’t really need. Spending money in times of stress is a coping method people use in order to escape from actual problems. There is clearly a link between depression and spending money. Can spending money be a sign of depression?

During the depression, people have difficulty managing their finances. This can be because of a lack of motivation. In this article, we explore if spending money is a sign of depression. We further define what is emotional spending and how we can address it. 

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Chapter 1:

What Is Emotional Spending?

When people have an urge to spend during a crisis, it is called emotional spending. In this, a person goes on shopping sprees when they are sad. They can spend a huge amount of money on eating or buying expensive items. In other cases, it can involve making investments without thinking. While some buy expensive shoes, others spend on food.

During this pandemic, a lot of people were facing stress and trauma. Many ended up going on shopping sprees online. While many people spend a lot of money on their lifestyle but people who spend emotionally, feel guilty after the spree. They only overspend during a crisis. They buy a lot of things when upset and later regret them. Depression and spending money sometimes go hand in hand. This is because spending gives people momentary happiness.

One step beyond emotional spending is compulsive spending. In this, a person spends far beyond what is necessary. This is sometimes done to an extent that it causes financial harm. One of the most common identifying factors in this condition is an uncontrollable urge. That is to say, the person finds it irresistible to control spending.

In some ways, spending gives people some kind of high. They find it pleasurable. Spending acts on the reward centers of the brain. Spending on things we like releases dopamine which is a feel-good hormone. It also makes us happy. This happy feeling is welcomed in cases of depression, stress, or anxiety. Impulsive spending is also a characteristic of bipolar disorder. That is to say, people spend in order to reach a certain high every now and then when they are upset.

Symptoms of Emotional Spending

  • Splurging money on things that are not essential.
  • Feeling guilty after spending.
  • Rationalizing the spending.
  • The person does not stop even when in debt.
  • They feel very good once items are bought but regret them later.
  • They may not use the items they have bought
  • Constantly thinking about the next purchase.
  • Spending money whenever upset.

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Chapter 2:

Depression and Spending Money

As explained, spending money acts as the reward center. It makes a person feel good. In depression, spending acts as a coping mechanism. We know that in depression, the levels of motivation are down. People have less energy to think rationally about money. There are sleep related problems. When we sleep less, it is difficult to think well. In depression, people have disturbed sleep.

When people spend money, they feel they can escape the real problem. In this way, shopping becomes a coping mechanism to hide from the real problems. In some cases, when people are lonely, they end up spending a lot. This makes them feel happy and belonged. When people want to gel up with their social circles, they spend the money that they don’t have on gifts and treats.

Another way in which depression and spending money are related is through gambling. People who gamble a lot can end up losing money. Ultimately the loss of money can lead to depression which can make the person spend even more in an attempt to re-earn.

Another way in which people can end up spending more during depression is by donating. They may feel that donation can help them recover from sadness or loneliness. In this attempt, they end up donating huge amounts of money which they don’t really have.

In cases of trauma or depression, memory is also affected. A person may end up forgetting their last large purchase and buying unnecessary items. Depression ultimately throws a person into a difficult cycle. On one hand, the income is low, and the spending is high. The ability to think clearly is affected and financial management is affected. All of this can lead to over-spending, debt, and more depression.

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Chapter 3:

How to Manage Spending Due to Depression?

Emotional spending can be a problem because it leads to financial debts. It ruins relationships and it can lead to a lot of guilt. People can be left without any savings for the future. A little bit of shopping or spending on self is good. In fact, it can also be a part of self-love. However when spending becomes a way of consoling yourself, then it is a problem. So to say, that every time, a new dress cannot be the way you feel happy. Overspending money is certainly a sign of depression. Therefore if you find spending money is giving you pleasure and guilt both, it is time to take action. Here are some ways in which you can manage emotional spending.

Let It Go!

Once you have realized that your spending is because of depression, learn constructive ways of letting your emotions go rather than running away from them. Spending, as discussed serves as an escape from negative emotions. Whenever you have this urge to spend money, try to sit for a moment and understand what you’re feeling at that moment. Write it down or cry it out. Spending will only give you momentary pleasure. The deeper issues still continue after spending.

Journaling

As discussed, depression and spending money are related. Journaling is very useful in depression or loneliness. It helps you put into words what you have been feeling. In this way, you understand what is really happening to you. In your head, there are a million thoughts. Writing helps you solidify them. It helps you understand the triggers and consequences. Slowly you start noticing the patterns of unhealthy coping. Once you do that, you start making strategies to change your behavior. Journaling also helps you keep a track of your own expenses.

Seek Therapy

As we know depression and spending money are related. Spending money is a sign of depression and other mental conditions. so it is important to seek therapy for depression. In other cases such as bipolar disorder or anxiety, it is even more important to go for therapy. Overspending is the upper layer of the problem. The real problem lies within. A therapist will help to uncover those issues. Additionally, in therapy people, discover better ways of coping. A person can learn how overspending is actually causing trouble in their life.

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Chapter 4:

End note

Overspending is a coping mechanism used in several mental health-related conditions. In many cases, people spend a to of money when they are facing low self-esteem. They do this in order to feel good about themselves. Therefore spending money is not just a sign of depression but also of low self-esteem. If low self-esteem is emptying your bank account, it is time to take action. Check out Epsychonline for courses on Low self-esteem. These courses are curated by experts to help people find solutions to their mental health problems. There are many articles that deal with topics such as depression and anxiety. Do check them out.

Reviews 4.1

Learn evidence-based scientific ways for managing irritable bowel syndrome.

95 Lessons

3 hours

  • Educational Content
  • Quizzes
  • Self-reflection material
  • Suggestions & feedback
  • Worksheet, tips & tools to use

€9.00 €12.00

25% discount