Six feet apart, face masks, online learning, and social isolation—these are some of the common experiences people faced during the COVID-19 pandemic, while some also experienced sickness and the death of loved ones. Community lockdown, widespread job insecurity, rampant financial stress, and relational conflict were also trademarks of this unique time in history, which offers to teach emerging adults and the rising generation some profound lessons—among them, the answer to how changes in financial stress can impact relational wellbeing.
Dr. Heather H. Kelley and her colleagues surveyed over 1,500 adults in the United States during the pandemic to investigate the impact of COVID-19-related financial change on family wellbeing by measuring relational conflict, family emotional closeness, and relationship happiness.[1] Rather than high levels of financial stress consistently leading to a decrease in family wellbeing and low levels of financial stress translating into growth in family wellbeing, Kelley and her colleagues found a somewhat surprising result. Relational conflict rose or fell with financial stress, but family emotional closeness and relationship happiness were impacted for good or for bad depending on a family’s cumulative demands, resources and support to offset those demands, and perceptions about their circumstances, as was revealed by the written accounts of real people who shared their experiences.
COVID-19 Factors that Intensified Financial Stress
Participants in Kelley’s study highlighted eight stress-enhancing financial factors during the pandemic, which represented five reductions in resources or support, two increased demands, and one negative perception. They were: (1) reduced hours or household income, (2) unemployment, (3) struggling to cope, (4) negatively impacted retirement or investments, (5) not receiving government benefits, (6) higher bills and costs, (7) relational stress, challenges, or worry, and (8) concern for their future economic situation.
Pay cuts, furloughs, and job loss were common and uncomfortable realities for many during the pandemic. Along with concerns for their financial future, job security, and food security, emerging adults faced unique stressors, such as breakup anxiety and household disruption.[2],[3] Older participants rode the wave of uncertainty as they saw retirement savings and investments plummet, and some who once qualified for government benefits lost their eligibility when employment status changed. The financial burden felt by emerging adults and families during the pandemic frequently spilled over into their mental health.[4] As one participant confided, “[It’s] a hard time for all of us.”
Social distancing increased the relational demand on working parents by requiring them to juggle work and homeschooled children in the same space, often resulting in work-family conflict and family-work conflict.[5] Community lockdown increased the financial demand of families living from paycheck to paycheck. As one parent pointed out, “Financial stress related to COVID-19 impacted me and my family because of increased spending on necessities such as food and medicine as well as household cleaning supplies.”
The psychological effect of an international health scare on the job market and the economy led one person to lament, “My stress comes from not knowing about my work stability.” Another participant spoke more generally, “[My stress is] due to uncertainty for the future and those financial goals.”
Truly, the economic hit and related financial stress by the pandemic was vast and varied.
COVID-19 Factors that Eased Financial Stress
But the pandemic cannot be aptly described as a financial burden that injured everyone in its reach. While more than 1/3 of the participants reported an increase in financial stress, the other participants reported either no change or decreased financial stress. Participants in Kelley’s study highlighted eight stress-reducing financial factors during the pandemic, which represented one positive perception, six sources of support, and one decreased demand. They were: (1) mental reframing and staying positive, (2) still having income, (3) past sound financial practices, (4) current sound financial practices, (5) government benefits, (6) family, (7) religious or spiritual practices or beliefs, and (8) reduced costs or expenses.
Given the pervasiveness of employment change during the pandemic, many who remained fully or even partially employed were quick to express gratitude. Their remarks began with phrases like “We were fortunate…” or “Thankfully, I am still…” A simple shift to see the good brought relief to many. One participant reframed his situation and said, “Just trying to stay positive…that we were all healthy.”
Pre-pandemic and pandemic financial prudence, such as reducing spending, sticking to a budget, contributing to savings, establishing and accessing an emergency fund, paying off debt, and other sound financial practices eased financial strain and even brought peace of mind to many during the pandemic. Furthermore, changes in lifestyle prompted by the pandemic helped many to reduce costs and expenses as families reduced dining out, limited travel, and focused on home-based entertainment.
Notably, 15% of the families in this study benefited financially during the pandemic. One participant shared, “We didn’t have any financial stress because our income didn’t change, and the stimulus checks were a great bonus for us to improve our debt level.”
Others found financial relief from relatives and religious communities.
What Made the Difference?
Kelley and her colleagues found that multiple negative factors simultaneously bearing down on families was the most likely scenario for poor family wellbeing, leading to increased vulnerability, strain, or harm. On the other hand, participants who cultivated a positive attitude, implemented wise financial practices, and established a support network benefited from those stress-reducing factors. Interestingly, a positive mindset was the most powerful catalyst of relational growth, leading families to transform their stress into positive change.
Summary
As today’s emerging adults learn from the past, they can live well in the present and look with confidence to a bright future in which their financial preparations now help them buffer unexpected financial setbacks, a support network of family and friends increases their emotional and financial resilience, and their positive mindset leads them to embrace challenges as steppingstones towards greater emotional closeness and happiness in family relationships.
Takeaways
1. Implement sound financial principles NOW.
The earlier you begin to put your financial house in order, the better. Some ideas include creating and living within a budget, establishing an emergency fund, or avoiding unnecessary debt. Fiscal discipline helps you meet present demands and be prepared for unexpected events in the future.
2. Don’t do life alone.
Family, friends, religious associates, or other sources of support bolster your resilience by providing people you can lean on emotionally or financially during turbulent times. Build a network of people on whom you can rely.
3. Cultivate an upbeat attitude.
Sometimes the only thing you can control in life is your attitude. After you have done all that you can do to improve a tough financial situation, mentally reframe the challenge and declare—"it could be better, but it could also be worse. I will be grateful that my situation is not worse.” This approach will protect your mental health and your family relationships.
References:
[1] Kelley, H. H., Lee, Y., LeBaron-Black, A., Dollahite, D. C., James, S., Marks, L. D., & Hall, T. (2022). Change in financial stress and relational wellbeing during COVID-19: Exacerbating and alleviating influences. Journal of Family and Economic Issues, 44, 34-52. https://doi.org/10.1007/s10834-022-09822-7
[2] Feiring, C., O'Dell, J., & Cortright, F. (2023). Emerging adult romantic relationship narratives during COVID‐19: Understanding relational challenges and opportunities. Personal Relationships, 30(2), 522-543. https://doi.org/10.1111/pere.12480
[3] Hotez, E., Gragnani, C. M., Fernandes, P., Rosenau, K. A., Chopra, A., Chung, A., Grassian, J., Huynh, S., Jackson, T., Jimenez, K., Jue, E., Le, N., Lenghong, J., Lopez, A., Lopez, L., Omo-Sowho, P., Pennington, K., Tirado, R. A., & Kuo, A. (2021). Capturing the experiences and challenges of emerging adults in college during the COVID-19 pandemic. Cureus, 13(8), 1-10. https://doi.org/10.7759/cureus.17605
[4] Heo, W., Yao, R., & Cho, S. H. (2024). Perceived mental and physical health during the pandemic: The role of financial stress. Journal of Financial Counseling and Planning, 35(2), 215–233. https://doi.org/10.1891/JFCP-2022-0108