![](https://cdn.cnn.com/cnnnext/dam/assets/210804185733-personal-finance-budgeting-stock-super-tease.jpg)
What happened after past recessions is one informative pattern as we consider the potential effects of financial stress long after the pandemic is over, said Brad Klontz, a financial psychologist and cofounder of Your Mental Wealth Advisors and the Financial Psychology Institute.
“On an individual level, financial strain is associated with depression and anxiety and relationship problems. But we’ve also seen it collectively when a community’s hit by foreclosures. Even if your house isn’t foreclosed on, there’s this collective stress everyone experiences, and hospitalization rates tend to go up.”
When crises beget perpetual fear
Shortly thereafter, there wasn’t much research on the mental health repercussions as “we hadn’t really defined trauma or post-traumatic stress as really even an issue,” Klontz said. Anecdotally, it “led to a traumatic experience for many people. And, if you know anyone who lived through it, it created an entire generation of hoarders who are worried about not having enough for the future — so, lots of anxiety, like a scarcity mentality and mindset and a deep fear of not having enough that seemed to be sort of crossed through the entire culture.”
After Klontz’s grandfather lost all his money when the banks collapsed during the Depression, he was so traumatized that he never put a dollar in the bank for the rest of his life, instead using a lockbox, Klontz said.
Experts have advice for how you can notice whether you’re headed down that path, and how to both mentally and practically manage during this time.
The line between normal and dysfunctional
Rigidly holding on to beliefs about who or what you can trust and how the world works, despite contradicting evidence or possibilities, is one sign that normal anxieties originating from one stressful financial circumstance are starting to take over, Klontz said. Other signs include problems in your relationship, ability to sleep at night and emotional functioning, Klontz said.
“When you see manifestations of hoarding and you see compulsive gambling, compulsive buying, 80% of people who exhibit those types of behaviors also have a history of trauma,” Klontz said.
It’s a “common reaction to going through a period of scarcity and trauma and being fearful of not having enough,” he added. “It’s the brain’s response to try to survive and to make sure that you’re safe.”
The impetus of dysfunctional behavior in this context is often a worry around a stressful or traumatic financial issue, and then the worry becomes “really difficult to shake,” Klontz said. “For example, growing up in poverty, the belief is that there’s not enough money or there’ll never be enough money.”
“If that’s really attached to emotion, one of two things happens: People will become an Ebenezer Scrooge type, where it’s like they’re so afraid of not having enough that they might be … making money, but they can never enjoy life. So that’s where they’re hoarding money, they’re sticking it aside because they’re so afraid,” Klontz explained. Conversely, this belief can lead to a learned helplessness wherein someone thinks, “‘If there will never be enough money, why bother trying?'” he added. “‘So if I can get a credit card, I’m gonna run it up.'”
These are symptoms of “delayed grief,” when you’re “unwilling to accept or discuss the deep-down emotion that you’re feeling,” said Sonya Lutter, a professor in the department of applied human sciences at Kansas State University and a certified financial planner. Until you acknowledge those emotions and worries, she added, you might address them with surface-level things that make you feel good temporarily.
Coping and resources for affordable support
Another way to prevent or stop catastrophic thinking is by practicing mental flexibility so you can adapt to changing circumstances, Klontz said. If you had lived through the Great Depression and concluded you couldn’t ever again trust banks with your money, for example, you would write your belief into a paragraph and then analyze it.
“To make that more accurate, it’s like, ‘Well, sometimes you can’t trust banks with your money. And these are the circumstances in which you can, and these are the circumstances in which you can’t,'” Klontz said. That way, you’re not relying on partial truths in every circumstance.
CNN’s Jeanne Sahadi contributed to this story.