How To Protect Your Mental Health During Financial Hardship

Society at large, along with many of our family members and friends, often hold financial responsibility in high regard. When you slip up or bills push you to bankruptcy, you could easily become overwhelmed and feel the heavy weight of shame. The stress that often accompanies bankruptcy could be difficult to manage. All in all, the emotional toll of financial stress could be hard to bear. 

While we will never claim to be medical experts, and nothing here constitutes medical advice, we’ve known our fair share of folks who have had a difficult time navigating the mental health challenges that can come along with bankruptcy, and we’ve seen what does and doesn’t help. This is a mix of lived experience, common sense, and readily available expert advice that anyone can find. We’re just combining it all here as a resource to help clients and others who are currently struggling. You aren’t alone, and bankruptcy is one of the best things you can do to get back on your feet. Here’s some additional insight that we hope can prove to be helpful.

Why People Choose Bankruptcy

Sure, there may be some individuals who simply lose track of spending, but the vast majority of those who end up filing for chapter 7 or chapter 13 bankruptcy do so due to things like job loss, medical expenses, and escalating mortgage or rent payments and the ever-rising cost of living. Combine two of these factors together–as often happens in real life–and the likelihood of quickly finding yourself underwater is high. No one sets out on a financial path with bankruptcy as the goal at the end of the road, but, due to life circumstances and unplanned or unexpected expenses, many find themselves there.

Most recent figures put the number of folks in the United States who filed for personal bankruptcy at 519,486 in the year ending June 2025. It’s also true that 10% or more of the US adult population have filed for bankruptcy at some point in their lives. Clearly, if you also find yourself here, you are not alone. Life is a lot, and when the best laid plans are sidelined by illness, injury, business expenses, tuition payments, medical debts, disability, layoff or caregiving and bills start to pile up, know that bankruptcy exists to help. That’s why it was created, and that’s why you should use this provision if you need it. Once it’s all over, you’ll likely agree that filing for bankruptcy was the best thing you could have done for yourself and your financial future. It’s a second chance that everyone deserves.

Bankruptcy and Negative Feelings

While we know that bankruptcy is a good thing for folks who really need it, we admit that it’s often difficult for those going through it to see it in a positive light. The associated stress and anxiety can blind you to the improvements that are happening, and shame could lead you to keep your negative thoughts and feelings to yourself. This can compound their effect and lead to serious outcomes that can have a direct impact on your mental health and overall wellness.

Some of the feelings that individuals going through bankruptcy may experience can include:

• loss of self-esteem
• loss of identity
• loss of control
• hopelessness
• despair
• shame
• anxiety
• depression
• guilt
• fear
• sense of failure

The stigma associated with bankruptcy can exacerbate these negative emotions, creating a significant psychological burden. Individuals without a support system could experience a serious toll on their emotional well-being. Those who do have concerned friends, family or colleagues may pull back in shame and end up straining these vital and meaningful relationships. Marital relationships can also suffer. Constant worry about finances could even lead some to substance abuse, risky behaviors, self harm and worse. The desperation that some feel could lead them to think that there is no solution and that they cannot continue the struggle.

Debt is not just a financial problem—it often precipitates a deep, emotional struggle that can have profound and long-lasting impacts on an individual’s overall wellness, their mental health, and their quality of life. For those with existing, underlying mental health conditions, the effect can be especially strong. Stress is also proven to negatively impact physical health, from insomnia and poor sleep to high blood pressure, heart disease, headaches, gastrointestinal problems, diabetes and other chronic conditions. All these factors combine to create a truly critical situation.

While the initial automatic stay and the eventual debt relief from bankruptcy can do wonders to lessen the stress, it can be hard to see the forest for trees. This is just one reason to always work with an experienced and empathetic legal professional, such as our Ohio bankruptcy lawyers. They can help you to focus on the good that you are doing for yourself and your financial health. Bankruptcy is fairly common in the United States, and it is nothing to be ashamed of. In fact, it’s the responsible choice when you can no longer manage your debt. And it’s a far better alternative than foreclosure or repossession and all the associated complications. 

How To Protect Your Mental Health

While for some it is counterintuitive to share their perceived failure with family and friends, maintaining open communication and leaning on the support from loved ones are critical ways to protect your mental health during this challenging time. Maintaining healthy relationships is one way to keep yourself safe, because the people who care about you will be there to remind you that you’re better than this current situation and that the future can be positive.

Here are some additional, practical ways that you can support your mental health:

Face Your Feelings: it’s okay to feel overwhelmed, and it’s far better to deal with the emotions than to deny them or try to suppress them

Be Open To Support: actively seek support from friends, family, or specific support groups who will listen, not judge, and affirm your value; talk to anyone you know who has been through bankruptcy themselves and glean any wisdom or help they have to offer

Seek Professional Help: if talking with loved ones isn’t helping and stress is mounting, professionally trained therapists and counselors can offer proven treatments and strategies to help in managing stress and negative emotions

Take Care of Yourself: do as much as you can to care for your physical health by getting adequate rest, nutrition, hydration and physical activity so that you can better cope with the stress

Practice Gratitude: whether as part of a faith-based practice, mindfulness or meditation, cultivating gratitude is a proven way to combat negative emotions and successfully navigate stress

Set Realistic Goals: once bankruptcy is complete and debts are discharged or you are on a repayment plan, focus on things you can control, like credit repair and establishing a monthly budget–taking action and celebrating small victories can help to alleviate stress

The Connection Between Mental Health and Debt 

In some instances, individuals who deal with established mental health issues may find that their condition is at the heart of their financial struggles. Some mental health conditions can cause individuals to be less able to work, can lead to unchecked spending, and more, especially during acute episodes. Medical expenses from treatment and medication can also stack up, exacerbating the situation. At the same time, financial stress is known to be a trigger that can provoke an episode or worsen existing conditions. The above-discussed negative emotions and belittling self-talk combined with constant worry can lead to a harmful feedback loop that can leave individuals feeling stuck. But the cycle can be broken.

Even with proper treatment, therapy, and a support network, regaining financial footing when also dealing with a mental health challenge can be difficult, to say the least. But it can be done. The team at Hausen Law can help you to tackle the financial and legal end of things so that you can focus on your health.

How To Think About Bankruptcy

Sometimes, reframing and changing perspectives goes a long way to helping you recontextualize a situation and put a more positive spin on something that’s worrying you. This can be true with bankruptcy as well. 

Instead of focusing on feelings of shame, guilt or failure, you can view bankruptcy as a fresh start. It’s generally not the result of poor money management, but a safety feature designed by the federal government for situations that are beyond your control. Really, filing for bankruptcy is a way to take back control of your finances. You are entitled to the help and deserve a second chance to enjoy financial freedom and stability.

When you make a conscious decision to view bankruptcy from this perspective and work hard to repair your credit and reestablish sustainable financial practices, you’ll begin to see bankruptcy not as an end, but as a beginning. There are a lot of misconceptions and misunderstandings surrounding bankruptcy, but when you work with a trusted legal expert, like the team at Hausen Law, you can rest assured that they understand what you’re going through and are eager to help you get back on a positive path. In his book, The Truth About Bankruptcy In Ohio, bankruptcy attorney James F. Hausen dispels the belief that bankruptcy should be a source of shame and instead positions it as a legal and respectable way to get out from under burdensome debt while also establishing a new beginning. That’s the approach you can always expect when you work with our understanding team.

Consult with an Experienced Ohio Bankruptcy Lawyer

If you’re ready to end the incessant harassment from creditors, end wage garnishment, stop the stress and gain a renewed sense of financial independence, it’s time to work with a chapter 7 bankruptcy lawyer. James F. Hausen and the team at Hausen Law will advocate for your rights and our 720 Credit Repair Program can help you to get out of debt, clean up your credit and rebuild your score. Once bankruptcy is filed, the automatic stay will kick in, preventing creditors from seeking repayment or landlords from threatening eviction, and you can breathe a sigh of relief. We will then work with you and your trustee and creditors to find the best resolution for your debt. Things will start looking up, we promise.

There’s no need to go it alone–contact our team today and take the first step on your path to financial wellbeing. If you’re unsure, take a look at what our customers are saying to see what’s possible for you, too. We know this isn’t easy, but we also know that you’ll get through it. 

At Hausen Law, we’re here to help, with an experienced team of chapter 7 bankruptcy lawyers, ready to take on your case and advocate for your best interests. James F. Hausen has handled thousands of cases throughout Northeast Ohio, including in the Akron, Canton, Cleveland, Columbus, Dayton, Cincinnati and Youngstown communities. Contact us today to set up a free consultation and learn more about your bankruptcy options. Inquire about our credit counseling and credit repair programs and choose to move forward toward a more positive future!