How Depression Can Lead to a Financial Crisis and Tips for Picking Up the Pieces

by Stephanie Dodaro

woman taxes depression“In the spring of 2003, I was 27 and finally on a cocktail of antidepressants that stabilized my Major Depressive Disorder (MDD). For the first time Though our big April tax deadline has finally passed, it doesn’t mean that financial stress or obligations are over for all of us. If you’re suffering from depression and haven’t filed your taxes or have fallen behind on other financial commitments, you may find yourself struggling to meet your basic needs, including making health insurance payments. You may feel ashamed or helpless, which can compound existing feelings of depression and anxiety. However, it’s never too late to reach out for assistance, and get the perspective, emotional support, and access to programs that you need.

People with mental illnesses are more likely to be in debt or face financial problems. Depression and anxiety can interfere with employment and money management. Debt, as well as unexpected unemployment, can exacerbate depression or trigger episodes in those prone to them. Whether financial problems or mental illness come first, either issue can fuel the other and cause a spiral of shame and paralysis where every choice seems like the wrong one.

Tax time can be particularly difficult, as it’s a time of cold, hard financial reckoning. We must gather our bills and statements, which can be a stressful enough process. In doing so, we also confront the state of our finances, which may not be particularly healthy. If you’re depressed, it can be very tempting to ignore your finances entirely.

When you’re feeling low, it’s difficult to see your way through setbacks, and act as your own advocate. Take small steps to begin your path to optimal mental health and financial recovery. It’s tough, but eventually you’ll start to see beyond the confines of depression.

  • Communicate your needs. You might feel ashamed or embarrassed to discuss your finances or your mental health, but try to keep in mind that depression is a very real and debilitating disease and take pride that you are working to improve your situation. By relating your feelings and fears to friends, loved ones, health care professionals, or service agency staff, you help open the door to solutions. Others can provide emotional support and connect you to services you might not have known existed.
  • Stay on your treatment plan. Give yourself a good foundation for mental and financial health by making sure you see your therapist and take your meds. If you haven’t been doing so, pick up the phone to ask your health care provider for emergency meds and make an in-person appointment. If you don’t have a therapist or physician, and if cost is an issue, there are many city-, state-, or federally funded mental health programs that can help, as well as inexpensive health centers for college students. Your physician may be able to provide you with free medication samples or connect you to free or low-cost patient assistance programs.
    If you feel you may need emergency medication or assistance, call 911 or go to a hospital emergency room or call the National Suicide Prevention Lifeline at 1-800-273-8255.
    If you don’t feel like your treatment is working, tell your doctor. Consider alternatives like light box therapy, Cognitive Behavioral Therapy, or Transcranial Magnetic Stimulation, a non-invasive therapy with minimal side effects that has proven highly effective for treatment-resistant depression.
  • Take small steps. If dealing with finances or preparing taxes seems like an overwhelming job, take one step at a time. Try just logging on to a tax prep program, gathering your W2s and financial statements, or taking a quick inventory of your monthly expenses vs. income. Even if your financial situation is not ideal, once you get started, you’ll probably feel some relief that you are taking steps to tackle it. Then you can start formulating short-term goals like completing your taxes or trimming monthly costs.
  • Tackle your taxes. If you missed the filing deadline, contact your tax professional or call the IRS to discuss your situation as early as possible, to minimize your fees and penalties and learn about possible installment plans or other options. Know that there is no penalty for late filing if you’re due to receive a federal refund, though state taxes may differ.
  • Seek out support groups. It can be extremely helpful and normalizing to talk about your frustrations and speak with others that are experiencing the same issues. Seek out your local mental health or financial support group for comfort, encouragement, and ideas about how to handle these challenges.
  • Assess your employment situation. If you feel that depression is affecting your job performance, speak with your human resources representative about your options. The Americans with Disabilities Act requires that businesses provide reasonable accommodation for people with disabilities (unless doing so would create an undue hardship). Accommodations for those with depression can include flexible scheduling, the option to work from home, or even a leave of absence.
    If your particular work environment is causing you anxiety, or you feel that the tasks associated with the position may be exacerbating your condition, consider looking for another position or switching to a career that is less stressful. While this may seem like a big step, it’s helpful to at least know that you have a backup plan.
    If you find yourself under- or unemployed, make sure you’re familiar with your state’s unemployment benefits. Some states offer extended benefits, as well as self-employment assistance. If you can’t afford health insurance apply for Medicaid, which provides free or low-cost coverage.

Consider comprehensive services. If you feel you need more comprehensive financial or medical assistance, there are programs that can help. Here are a few:

  • Intensive Case Manager (ICM) Services: ICMs can provide you with intensive, one-on-one support to help you navigate daily activities as well as financial management. Available through city or state agencies.
  • SSI (Social Security Income) or SSDI (Social Security Disability): These federal programs provide needed financial assistance to people with mental health conditions who have limited ability to work.
  • Work Employment Program (WEP): Medicaid’s WEP prepares you for a new profession or by providing Internships at various city or state agencies, which can lead to full-time work.

Financial setbacks can be particularly debilitating for those of us with depression, as they affect our ability to pay for treatment. It’s also difficult to ask for help with finances and depression, and sometimes you need to keep asking until you find the right services or service providers, a process that can take weeks or months. When you’re feeling anguished this can be incredibly frustrating, but remember that each ask will bring you closer to the services you need and deserve.