Can credit card debt be an emotional trigger? Does an eviction twist a person’s emotional equilibrium out of shape? Does a childhood of poverty impact the spending habits of an adult?

Anyone familiar with a therapist’s couch will know to past traumas are often the root cause for later issues. But the connection between money and mental health is one that neither financial planners nor therapists have been eager to make.

The financial planners didn’t want to deep-dive into a client’s feelings; mental health professionals didn’t want to help a client balance their budget.

That professional partition, however, has been crumbling since the Great Recession, and the economic stress of the coronavirus pandemic has only accelerated the acceptance of a new field known as financial therapy. The discipline lifts the curtain on the emotions and trauma driving an individual’s relationship to money.

“The acknowledgment of financial trauma is a newer development in the industry,” said Heath Carelock, program director of Prince George’s Community College’s Financial Empowerment Center in Maryland. “It’s like a new frame of looking at people’s relationship with money.”

Carelock is among a growing cadre of professionals who have begun integrating aspects of both mental health and money coaching. In addition to his regular duties at PGCC as a financial coach and running workshops, the 41-year-old is pursuing a graduate certificate from Kansas State University in financial therapy — the first program of its kind that has been in operation for more than a decade.


Mental health resources from The Seattle Times

Financial therapy as a practice started in 2008, when the country was in the depths of the economic downturn triggered by the collapse of the housing market. According to Megan McCoy, director of Kansas State University’s personal financial planning master’s program, a group of planners and providers got together at the time to discuss what they were hearing.

“One group said, ‘I feel like I’m doing counseling sessions in my financial planning sessions,’ ” McCoy said. “And the mental health people said, ‘Really? All we do is talk about money in our sessions.’ “

The connection made sense, McCoy said. “Money is the object we project our deepest dreams and fears upon,” she said. “It’s natural that when we talk about money it releases all kinds of intense emotions.”

McCoy and others began devising the strategies that became financial therapy, creating a wider umbrella that could both include dollars-and-cents advice and explore the feelings fueling spending habits.

“We look at all types of relational patterns,” she said. “Did all the women control money when you were growing up? Did only the men control the money? Was it a pattern where the youngest was always an artist and the oldest was expected to be obsessed with making money?”


Uncovering these motivations makes it easier to isolate the behavior and suggest alternatives. Therapists design treatment plans around encouraging clients to make different choices.

The choice to dive into financial trauma had a number for roots for Carelock. He attended PGCC 20 years ago. After college he taught around the world, including in Vietnam and the Middle East, before eventually landing back in the Washington, D.C., region working in financial education. He started at the college’s financial empowerment center in 2018.

At the center, he works with clients who have been trying to sort through the economic damage wrought by the pandemic — damage that often went deeper than bank accounts.

“It began to occur to me that people’s livelihoods and lives and expectations were all disrupted,” he said. “We project out that there’s a certain level of longevity in all of us if we’re healthy. That was completely disrupted and violated. There were people who died prematurely, and they were often the economic engine of their family.”

In terms of financial trauma, Carelock said there are four main types: severe debt; child poverty; job loss and long-term unemployment; and the loss of the ability to retire. Each area can affect how a person behaves and feels about money. Finding those potential traumas, however, is delicate.

“Generally when I have clients with trauma, it’s really important for me not to go to them in this session and be like, ‘Hey, so you ready to talk about your budget?’ “


Instead, a questionnaire before meeting with clients helps Carelock feel out their goals and priorities, while also attaching a narrative to certain spending choices that explain more fully their place in a person’s life. For example, Carelock might see a client is paying monthly for Netflix — a cost that could be cut.

“But then the client might say, ‘I am not willing to stop my Netflix subscription,’ ” said Carelock ” ‘I know I need to make ends meet, but this is what gives me a chance to chill out and unplug for the day.’ So you see that clients have their own negotiables.”

Financial therapy, meanwhile, is becoming more established. The Certified Financial Planner Board of Standards, the professional standards-setter for financial planners and coaches, last year introduced requirements for all planners regarding therapy training. Last month, the organization published the first textbook spotlighting the psychological impact of money.

McCoy believes the current interest sparked by the pandemic is fueling a boom in financial therapy that’s larger than what followed the Great Recession. She said other universities are also launching their own certificate programs.

“The pandemic seemed to open up a lot of people to talking more about trauma,” she said. “It’s not taboo anymore.”