Financial embarrassment affects third of Canadians

Chronic financial embarrassment affects roughly a third of Canadians, leading to emotional distress and impacting their financial and personal decisions. These feelings of ‘financial shame’ can result in individuals falling into a cycle of increasing debt and anxiety due to not seeking help. The causes are complex and intertwine with cultural attitudes, personal experiences, and societal stigmas about debt. Chantel Chapman, a financial trauma specialist and CEO of “The Trauma of Money”, distinguishes between mere regret over financial mistakes and financial embarrassment, which leads to doubts about one’s ability to manage money. By advocating for financial literacy and informed decision-making, Chapman believes that one’s financial health can be greatly improved. However, financial embarrassment often gives rise to destructive behaviors, such as excessive spending or hoarding, resulting in an amplified cycle of avoidance and shame. Such a negative attitude towards money can negatively impact mental health, leading to anxiety, depression, and chronic stress. Hence, it is crucial to tackle financial difficulties immediately and get professional help if necessary. A survey by Coast Capital found an alarming 63% of Canadians avoiding confronting their financial situation. Techniques ranged from deferring financial goals to avoiding conversations and decisions about money.

Addressing financial embarrassment among Canadians

Such behaviour points to high levels of financial stress. If left unaddressed, individuals could face severe financial instability in the future. Chapman maintains that the cycle of financial embarrassment can be broken. She suggests acknowledging and expressing shame, understanding the root causes, and starting open conversations about money with reliable sources. A non-judgmental environment is important for these discussions. This safe space promotes honesty and transparency and encourages the adoption of positive financial habits. Chapman believes that by applying these strategies, individuals will better understand their financial embarrassment, making it less daunting to handle. This will empower them to make wiser financial decisions leading to improved financial well-being. Chapman thinks that financial success can only be achieved if there is a proactive engagement with finance rather than a passive response to financial situations.