different health issues. In June this year, the Financial Stress Index published by FP Canada showed that 39 per cent of under 35 individuals who participated in the study said financial stress has led to health issues, while 11 per cent said the situation has caused mental health challenges or leading to substance abuse. However, in the case of those above 35, 28 per cent said financial stress had impacted their health, while only 5 per cent saw this lead to mental health concerns of substance abuse.
According to Chantel Chapman, a financial trauma researcher based in Richmond, the human body and brain do not distinguish financial stress and any other kind of stress caused by relationships or work. She is of the view that the current housing affordability issues in Canada are more likely to cause financial stress, with a significant portion of their income going towards paying rent, leaving it difficult to repay loans or build sizable savings.
“Sometimes people have overspending stress because they’re trying to spend to survive. Their housing costs might be around 60 per cent of their income. The cost is very high compared to their earnings.” Chapman told BNN Bloomberg.
The financial trauma expert also noted that another major reason causing higher financial stress among younger Canadians is the increased time spent on social media. She pointed out that excessive social media engagement could have a direct link to feelings of inadequacy or stress, resulting in a state of comparison and causing feelings of scarcity.
According to analysts on financial planning, one of the best way to alleviate some financial stress is by mapping out one’s income and expenses. They point out that although the entire income may be spent on rent, bills and groceries, financial planning can still be advantageous. “Your goal for this would be to just not go into debt and if you do go into a little bit of debt, stay calm and then work out a short-term plan to pay it back in a sustainable way,” Shannon Lee Simmons, founder of the New School of Finance, a Toronto-based financial planning firm, said.
