Can Money Troubles Trigger PTSD?

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People who have lived through difficult financial problems can also suffer from PTSD.

This post by Steve Rhode comes from

Post-traumatic stress disorder (PTSD) is something we normally associate with the military. But the reality is many traumatic situations, including the financial kind, can also trigger PTSD.

Your first reaction might be “that’s not possible” or “that’s not true.” But in fact it is possible and it is true that many people have struggled with debt-related PTSD.

Money problems have two primary components. The first is the actual events that led to the financial trauma. The second is the aftermath and emotional impact the financial trauma causes.

[Financial] Trauma: “An emotional state of discomfort and stress resulting from memories of an extraordinary, catastrophic experience which shattered the survivor’s sense of invulnerability to harm.” (Trauma and its Wake, Charles Figley, Ph.D.)

The reality is many traumatized by money troubles might suffer from PTSD, and without treatment and/or awareness, it could dramatically alter their lives.

Debt-related PTSD begins once the trauma is felt, and impacts the ability of an individual to deal with their debt in a healthy way. Dr. Goulston, a psychiatrist, describes what he calls the “Four D’s of Financial PTSD,” debt, dependency, distrust, and denial: conditions holding people back from making level-headed decisions about how to best deal with debt.

I can’t tell you how many times I’ve had people tell me that they’re stuck not knowing what to do to get out of debt or avoiding credit after dealing with debt because they don’t want to face the pain again.

Sarah, who lived through debt, said, “When I was in debt, it didn’t just feel like ‘stress’ – it felt like my life was falling apart. It also left me wondering if I will ever shake the feeling that I could lose everything again at the drop of a hat.”

People like Sarah mistakenly link credit with the traumatizing feeling occurring when they think about having credit again. In her mind, good credit equals pain because the good credit led to problem debt and problem debt led to pain.

Financial PTSD can link people to behavior that holds them back. By not taking action to deal with their debt they find themselves in a perpetual cycle of self-fulfilling financial unhappiness.

Some say their money troubles have left them distrusting and depressed. And I’ve talked about the impact of denial in the process of dealing with debt in my article on the seven stages of debt.

There have been limited studies about the effects of financial problems and the results of PTSD, but one recent study done on victims of the Madoff scam stated:

Results demonstrated that a majority of respondents (55.7%) met criteria for a presumptive DSM-IV-TR diagnosis of PTSD, and as a group, respondents acknowledged high levels of anxiety (60.7%), depression (58%), and health-related problems (34%). Victims overwhelmingly affirmed a substantial loss of confidence in financial institutions (90%). This raises a public health concern as to governmental response and counseling needs during times of severe economic trauma.

So if PTSD can be experienced as a result of financial trauma or debt trauma, what can be done?

Currently there are a number of therapies for those suffering from PTSD. But the most important step is to reach out to the suffering and guide them toward help – or to seek help if you’re the one struggling.

The most common avenues of treatment are counseling, therapy, medication, or a combination. If you’re looking for help, talk to your doctor about a referral for anxiety counseling or find a local mental health professional that has experience with PTSD. You may also want to use the links provided here.

For a more in-depth look at PTSD and money-related issues you can read Debt-Related PTSD and Financial PTSD Quietly Hurts Many.

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