Cost of living, uncertainty, and mental health — you're not imagining it, and you're not alone
Something has shifted in the last few years in the therapy room. The specific words people use have changed.
A few years ago, people would come in and say they were stressed, or overwhelmed, or struggling with anxiety. Those words haven't gone away. But increasingly, underneath them, there's something more specific. For some people it's money — the cost of groceries, the mortgage that's gone up again, the rental market that feels impossible, the sense that no matter how hard you work, it's never quite enough.
For others — particularly younger people — it's something harder to name. A kind of low-level dread about the future. The climate. AI. Jobs that might not exist. A world that feels like it's changing faster than anyone can keep up with, in ways that feel largely out of their control.
Often, it's both at once.
If any of that sounds familiar, I want you to know something before you read another word: what you're feeling is not weakness, and it is not in your head.
1 in 2
More than one in two Australians say the rising cost of living is having a major impact on their mental health — and one in five say that cost itself is a barrier to accessing the support they need. Source: Mental Health Australia / Ipsos, 2025
Those numbers matter. But behind every statistic is a person. A person who is lying awake at 2am doing the maths. A person who said no to the school excursion. A person who is holding everything together on the outside while something quietly frays on the inside.
This post is for that person.
What financial stress actually does to the mind and body
Financial stress isn't just an economic problem. It's a psychological one — and it affects the mind and body in ways that go well beyond "feeling worried about money."
When you're under sustained financial pressure, your nervous system stays in a state of heightened alert. Your brain is scanning for threat constantly. And because the threat — money, debt, housing, bills — doesn't go away after a few days, the stress response doesn't get to switch off. It just... keeps going.
Over time, that chronic activation shows up in all sorts of ways that people don't always connect back to financial stress:
Difficulty sleeping — either not being able to fall asleep, or waking in the early hours with your mind already racing
Irritability and a shorter fuse — snapping at people you love, feeling easily overwhelmed by things that wouldn't normally bother you
Difficulty concentrating — that foggy, scattered feeling where you can't seem to hold a thought
Physical symptoms — headaches, muscle tension, digestive issues, a general sense of physical unease
Withdrawal — pulling away from friends and social situations, particularly ones that feel like they involve spending money
A pervasive low mood — not quite depression, but a kind of flatness or heaviness that doesn't fully lift
Shame — one of the most painful parts of financial stress, and one of the most isolating
If you recognise yourself in any of those, it's not because you're weak or you can't handle things. It's because you're human, and you're carrying something genuinely heavy.
"Financial difficulties can increase the likelihood of developing a mental health problem. And experiencing a mental health problem can make it harder to manage your finances."
— Beyond Blue, 2025
That cycle is one of the hardest things about financial stress. The two problems feed each other. The more stressed you are, the harder it becomes to think clearly, to problem-solve, to show up at work, to maintain the relationships that might otherwise be a source of support. And that can make the financial situation feel even harder to navigate.
The Western Sydney reality
I want to be specific for a moment, because I think geography matters here.
We're based in North Parramatta. We work with people from across Western Sydney — Parramatta, Blacktown, the Hills District, Penrith, Westmead. And this part of the city has been disproportionately affected by cost-of-living pressures. Housing costs have risen sharply. Mortgage stress is real and widespread. The cost of everyday life — groceries, fuel, school expenses — has increased in ways that are acutely felt in communities where incomes are stretched.
We also know that people in Western Sydney are less likely to seek mental health support than people in inner-city areas — partly because of cost, partly because of access, and partly because there's still a culture of pushing through, of not complaining, of getting on with it.
I have enormous respect for that resilience. I also know that it has a limit. And that asking for support before you hit that limit is almost always better than waiting until after.
The age of uncertainty — what it's doing to young Australians
I want to say something specifically to younger people — or to anyone who has younger people in their lives — because what I'm hearing in sessions from this group is distinct, and it deserves to be named properly.
The 2025 Australian Youth Barometer found that most young Australians fear being worse off than their parents — navigating shifting goalposts in education, insecure work, housing that feels permanently out of reach, and an anxiety about the future that goes well beyond the usual worries of being young.
64%
64% of young Australians said cost of living was a key concern in 2025 — up from 31% in 2023. That's a dramatic shift in just two years, and the highest level recorded since the question was first asked. Source: Mission Australia Youth Survey, 2025
But cost of living is only part of the picture. Underneath the financial anxiety, there's something else — a deeper, more existential uncertainty that's harder to put into words and harder still to "solve."
The climate
Research from Orygen found that 76% of young Australians are concerned about climate change, and 67% say it's having a negative impact on youth mental health. This isn't just abstract worry — it's the lived experience of growing up watching increasingly frequent bushfires, floods, and extreme heat events, and understanding that this is the world they will inhabit for the rest of their lives.
For some young people, this manifests as what researchers are calling eco-anxiety — a persistent, ongoing worry about environmental change that can affect daily functioning, decision-making, and their sense of the future. It influences choices about where to live, whether to have children, what career to pursue. It's not irrational. It's a rational response to real information — and it deserves to be taken seriously, not dismissed.
AI and job security
A 2026 NSW Youth Week poll found that mental health is the top issue for young people in NSW, followed closely by cost of living and housing. And threaded through all of these concerns is a newer anxiety: artificial intelligence and what it means for the future of work.
Roughly 29% of Australians fear AI will cost them their job within five years. For young people who are only just entering the workforce — who have studied for careers that may look very different in a decade — this uncertainty creates a particular kind of psychological strain. It's hard to plan. It's hard to feel secure. It's hard to know what to work toward when the goalposts keep moving.
What makes uncertainty so hard psychologically
Here's something that's well-established in the psychology of stress: uncertainty is often harder to tolerate than bad news. When something difficult but certain happens, we can grieve it, adapt to it, make decisions in response to it. When the threat is vague and unresolved — "something might happen, I don't know when or how bad" — the nervous system can't settle. It stays alert, scanning, waiting.
That's exhausting. And it's a significant part of what many young people are living with right now — not a single identifiable crisis, but a persistent background hum of worry about a future that feels genuinely unpredictable.
"Being young today isn't what it used to be. In the face of existential threats — cost-of-living pressures, housing affordability, the unfolding climate crisis — being young means navigating changing goalposts in education and employment, and experiencing anxiety and entrenched pessimism about the future."
— Monash University Youth Barometer, 2025
I want to be careful here not to catastrophise. Most young people I work with are also deeply capable, creative, and resilient. Many are finding meaning and connection and genuine joy in their lives despite the backdrop of uncertainty. But the uncertainty is real. The anxiety it generates is real. And pretending otherwise — telling young people to just focus on the positives, to stop doomscrolling, to be grateful — is not helpful and often makes them feel worse.
What actually helps is having a space to say: this is hard, and I feel overwhelmed by it sometimes, and I'm not sure how to think about the future. And to have someone sit with you in that, rather than rushing to fix it.
The shame piece — because it needs to be said
Financial stress carries a particular kind of shame that other stressors often don't. There's something about money — or the lack of it — that people find deeply personal. As though how much money you have is a measure of your worth, your intelligence, your work ethic, your value as a person.
It isn't. But the feeling is real, and it's worth naming.
Shame is one of the most isolating emotions we experience. It makes us want to hide — from friends, from family, from ourselves. It makes us reluctant to talk about what's actually going on, which means we carry it alone, which makes it heavier.
Part of what happens in a therapy room is that the shame gets to come out into the open. Not to be fixed immediately — but to be looked at, named, and held by someone who isn't going to judge you for it. That process alone can meaningfully reduce its weight.
You are not your bank balance. You are not your mortgage stress. You are not your inability to afford the things you wish you could give your family. And you deserve support regardless of your financial situation.
What helps — from a psychological perspective
I'm not going to tell you to "practise gratitude" or "limit your news consumption." Those things have their place, but they're not what I'd say to someone sitting across from me who is genuinely struggling.
Here's what I'd actually say.
Name what's happening
There's a difference between knowing you're stressed and being able to say: "I'm carrying significant financial stress and it's affecting my sleep, my mood, and my relationship with my partner." The second is more specific, and specificity gives you something to actually work with. It also reduces the vague, pervasive sense of dread — because you've located the problem rather than just living inside it.
Separate what you can and can't control
Financial stress often comes with a sense of total helplessness — like the situation is completely out of your hands. Sometimes it genuinely is. But often there's a mixture: things you can't control (interest rates, the cost of groceries, your landlord's decisions) and things you might have some agency over, even small amounts. Identifying those, clearly and honestly, can reduce the feeling of being entirely at the mercy of circumstances.
Watch the coping strategies you reach for
When people are under sustained pressure, they reach for things that provide short-term relief — alcohol, food, screens, overworking, withdrawing from relationships. These are understandable. They're also worth paying attention to, because the short-term relief often comes at a long-term cost. Not because there's anything wrong with you for reaching for them, but because they tend to deepen the hole over time rather than shorten it.
Talk to someone — really talk to someone
Not someone who will tell you it'll be fine. Not someone who will immediately try to solve the problem. Someone who will sit with you in it, help you make sense of what you're experiencing, and help you find your way through rather than around.
That might be a trusted friend or family member. It might be a financial counsellor — the National Debt Helpline (1800 007 007) provides free financial counselling and is an underused resource. And it might be a psychologist — not because you're broken, but because you're carrying something that's worth getting proper support with.
What about the cost of getting support?
I'd be doing you a disservice if I didn't address this directly, because I know it's the first thing a lot of people think when they consider therapy: I can't afford it.
That concern is real and I'm not going to dismiss it. But I do want to make sure you have accurate information, because the psychology Medicare rebate system is genuinely helpful — and often misunderstood.
What you need to know about Medicare and psychology
If you have a Mental Health Treatment Plan (MHTP) from your GP, you are eligible for a Medicare rebate on up to 10 individual psychology sessions per calendar year.
The rebate for sessions with Cassie (Clinical Psychologist) is currently $145.25 per session. For sessions with Clint (Psychologist) the rebate is $98.95 per session. This significantly reduces the out-of-pocket gap.
You don't need a referral to enquire with us or to book a free 15-minute introductory call. The MHTP is only needed to claim the Medicare rebate.
The free National Debt Helpline (1800 007 007) is also worth knowing about if the financial side of things feels unmanageable — they provide free, confidential financial counselling and can help you work through practical options.
You don't have to be coping well to reach out
One of the things I've noticed over 25 years in this field is that people tend to wait. They wait until things get worse. They wait until they've tried everything else. They wait until they feel like they've earned the right to ask for help — as though there's some threshold of suffering that qualifies you.
There isn't.
If financial stress is affecting your sleep, your mood, your relationships, or your sense of yourself — that's enough. You don't need to be in crisis. You don't need a perfect explanation of what's wrong. You just need to be ready to have an honest conversation with someone who gets it.
We're a small practice in North Parramatta. We work with adults and teens navigating all kinds of things — including the very real, very human experience of feeling the weight of financial pressure on every part of your life. We see people in person and via telehealth.
If you've been thinking about reaching out — even just a little — this might be the moment.
