We know you have written about the economy and mental health before, perhaps we can ask you to elaborate on a few questions.
1. How is mental health linked to economic success and failure?
One’s ability to be stable economically may be closely related to one’s personality and/or other mental health issues. First here is the issue of getting on a career path, and next is the issue of how one spends and invests their income.
While some persons make a reasonable living no matter what path they study or train for, persons who have a plan and obtain some kind of recognized credential tend to be more stable and thrive better than those that do not. Persistence, drive, and focus are important qualities here. In addition, while it is favorable to be affable and friendly no matter what occupation one is in, some occupations are more dependent on one’s charisma in terms of their ability to exude trust, likeability, and collect a set of followers.
Regarding saving and spending, planning and organization is a crucial quality for success. Persons who spend out of their means and/or wish to have a lifestyle that is out of their income level without thinking of the consequences will naturally have financial trouble.
For investing, it is always more adaptive to live within one’s means and invest with minimal risk. Investing companies will recommend to take some risk with a proportion of one’s assets. This may be more of a function of an investing company’s desire to make commission from the turnover of brokering stocks than the success of the investor. Small amounts of assets invested in higher risk stocks might be ok, but one would need to assume the monies invested in this fashion may likely be lost or risk the possibility of considerable mental stress related to loss. Persons who feel they must “get rich” from investing are at high risk for loss and the mental anguish associated with loss.
2. What can investors do to safeguard their mental health during a trying economic time?
This is really a function of what persons have done with their careers and finances before the trying economic time comes around. The more flexibility persons have in the work they can do, the more economic redundancies a family has, i.e., both partners in a marriage have jobs that are less vulnerable to economic downturns, the more they have some stable income from safe investments, and the less they have over extended themselves in loans and purchases, the less chance of having unstable mental states.
3. Do you recommend regular vacations or digital holidays to recharge the mental battery and decompress?
Yes, both of these are good ideas. Weekend trips and taking at least a few days every few months to be in a new environment and see new things is very important to stay excited about life. Knowing when to get away and turn off your PC or phone is a good thing.
If you can’t turn off your phone regularly, then having an old mobile phone just for calls is one way to avoid the kind of “phone addiction” we see in so many people recently. Of course the digital age comes with many conveniences and efficiencies, however, looking at a small screen (or any lit-up screen) for hours is a strain on one’s eyes, and time spent reading content or seeing videos with minimal intrinsic value can keep people from normal social interaction or using their mind in more valuable stimulating ways.
4. After the stock market crash in the 30s, there were lots of mental health issues. Similarly in 2008, after the financial crisis, there was a rise in suicides. Why are we not getting better at separating our emotions from the economy?
This is an interesting question. Unfortunately, I don’t think so. People are still hooked on making quick and easy income and tend to focus on the stories that they hear about big winners. In this sense, the stock market is similar to a gambling casino in giving the promise of reward. If you look at a slot machine, there are usually images of lots of money or happy people, and investment groups usually put out graphs of increased earnings.
It is rare to see a slot machine or investment graph that emphasizes loss and grief. The average person is also not aware of the influence government, large investment banks, and other entities have on pumping up stock prices into a bubble that eventually leads to a fizzle-out, or worse, a bust. Humans evolved to get the next meal as soon as possible, not to look at nuanced and complicated things. The best thing we can do is educate the public, unfortunately, there are few entities willing to spend the resources for an education campaign. Perhaps the best way to do this is to make a lecture series on this topic mandatory for high school students.
Read more on Dr. Doug Berger’s comments as it relates to mental health and the economy here: http://www.megurocounseling.com/TF/2013/May_2013.pdf.