Content Advisory: This article includes a general discussion (no specific details) of depression and its effects, including taking your own life. I encourage you to reflect on your capacity for such information right now or consider reading it at another time.
Depression and financial stress are common among entrepreneurs. Behind the scenes, many business owners grapple with the heavy burden of financial stress and its profound impact on their mental health.
The research is clear: financial well-being and mental health have a direct correlation.
The qualities that make us driven and ambitious can also predispose us to mental health struggles. For example, the pressure to succeed, the fear of failure, and the relentless pursuit of our goals can often leave us feeling overwhelmed and isolated, even when things seem to be going well on the surface.
It’s a vicious cycle that often goes unnoticed until it’s too late.
Reliable data about entrepreneurs who take their lives in comparison either to workers or other high-achievers is not readily available; however, we know that the enormous uncertainty, exhaustion, risk, and resulting high stress that confronts every business owner have mental health impacts, including depression and thoughts of taking their lives.
In this article, I will unpack the relationship between money stress and depression among entrepreneurs, explore the unique ways depression shows up for business owners, and offer practical strategies to address depression related to financial stress.
The link between financial stress and depression
Generally speaking, economic security is a very significant factor in supporting mental health. The more financial insecurity and stress you experience, the more you are likely to experience depression. In this systematic review of 40 observational studies that quantified the relationship between various measures of financial stress and depression outcomes in adults, most of the reviewed studies show that increased financial stress is associated with depression.
Financial stress is a potent trigger for depression among entrepreneurs, exacerbating feelings of anxiety, hopelessness, and inadequacy. The relentless pressure to succeed, coupled with the fear of failure and financial ruin, can create a perfect storm of psychological distress.
Moreover, the stigma surrounding financial struggles and the perception of entrepreneurship as a solitary pursuit often deter entrepreneurs from seeking help, exacerbating feelings of isolation and despair.
The emotional toll of running a business
Being a successful entrepreneur does not always guarantee immunity from depression. On the contrary, the very characteristics that drive us to embark on entrepreneurial endeavors—such as ambition, resilience, and tenacity—can also make us susceptible to mental health struggles. Ironically enough, the risk of depression may be even higher for business owners who are wealthy and accomplished.
High expectations can often be a leading cause of extreme distress. For example, when the business isn’t growing the way business owners or investors have expected, entrepreneurs can be predisposed to disappointment and public embarrassment while also subjecting employees, investors, and families to consequential negative impacts.
This pressure to succeed, fear of failure, and relentless pursuit of goals often leaves entrepreneurs feeling overwhelmed and isolated, even when the business seems to be doing well on the surface. In addition, the pursuit of wealth and business success at all costs can sometimes exacerbate our mental health issues, leading us down a path of burnout and disillusionment.
- Chronic stress can lead to depression: Entrepreneurs know financial stress all too well. From securing funding and managing cash flow to navigating economic uncertainties and shouldering personal financial risks, the entrepreneurial journey is fraught with financial challenges that can take a toll on mental well-being. Studies have shown that entrepreneurs are disproportionately affected by mental health issues, with high rates of depression, anxiety, and burnout linked to the pressures of running a business.
- The cause of depression in entrepreneurs: Depression is depression is depression, whether or not it is related to financial stress. Sometimes there is a direct cause (called situational depression) and other times it’s hard to put your finger on the root of it. When most people hear the word “depression,” they imagine deep sadness or inability to function. Depression isn’t just feeling sad. In fact, it’s a common misconception that you need to be sad to have depression. In the entrepreneur’s depression experience, some business owners may experience what could be considered the stereotypical depressive experience. This is profound lethargy and a pervasive sense of hopelessness, but any business owner may not show that outwardly.
- Financial depression symptoms are nuanced: Some depressed business owners may grapple with the subtle manifestations of depression, such as persistent self-doubt, incessant comparison to peers, and an unrelenting pursuit of perfectionism that leads to burnout. Imagine performing at an exceptionally high level while feeling internally disconnected. You’re delivering presentations, closing deals, and meeting deadlines, yet inside, you feel like a shell of yourself. This form of depression, sometimes called high-functioning depression, is the reality for many high-achieving entrepreneurs experiencing depression.
This image represents a 100% truthful experience. Depression, anxiety, and financial stress are not “just in your head.” It’s impossible to “just be happy” or to “just change your thoughts and you’ll feel better.”
That said, a lot of the experience of depression is in your head.
Signs of depression in entrepreneurs
Depression fundamentally alters how we think, process information, and interact with the world. These symptoms can make it hard to think, work, sleep, study, eat, and enjoy life. Entrepreneurs who have depression may look from the outside like they have it together. But their inner experience can be zombie-like. They are functioning while at the same time, on the inside, they are questioning their existence and feeling hopeless about the future.
Entrepreneurs might experience cognitive effects of depression, such as:
- Impaired concentration and memory
- Negative cognitive biases
- Rumination and intrusive thoughts
- Reduced cognitive flexibility
- Executive function disruption
Entrepreneurs might experience psychological effects of depression, such as:
- Persistent self-doubt
- Paralyzing perfectionism
- Constant comparison with peers
- A pervasive sense of emptiness or numbness
Entrepreneurs might experience physiological effects of depression, such as:
- Chronic sleep disturbances
- Significant changes in appetite and weight
- Increased cardiovascular stress
- Gastrointestinal complications
- Heightened inflammatory responses
Maybe you’re able to keep it together while working but then unable to function in other aspects of your life. For example, you might seem like your normal self at work, but most nights you come home and break down.
My experience with depression while running a business
I’ve had mild, moderate, and severe depression on and off throughout my life. This sometimes involved having thoughts of taking my life, both when I was running a business and when I was employed.
A few years ago, after a new medical diagnosis, I experienced a brief period of thoughts of taking my life, even though I wasn’t depressed. (Note: You don’t have to be depressed to be considering killing yourself. Unbearable psychic pain and a sense of hopelessness and helplessness can also be the cause.)
Earlier than that, I experienced clinical depression. It was situational, meaning it was related to the situation I was in at the time, in pain, waiting for hip replacement surgery, and unable to walk more than a few steps.
It was debilitating. I felt like a shadow of myself. I didn’t enjoy the things I used to and was deprived of many of the things I used to do to cope because of limited mobility and COVID isolation.
At work, I managed to be present because my focus was on other people’s situations and accompanying them with compassion, but it took everything I had. Outside of work, I felt like I was sleepwalking through life. I knew that much of my depression would resolve with the hip replacement surgery, but what to do in the meantime?
How to cope with depression caused by financial stress
I want to clarify that if your situation is making you depressed, there’s nothing wrong with you. The experience of depression doesn’t feel good and I know you don’t want to feel this way. However, the way you’re feeling is what we would expect you to feel, given what you’re going through. It’s human to be affected by stress in general and financial stress in particular.
Here are a few ways to cope with your financial depression:
Take action to address your financial stress
There may be specific steps you can take to address the aspects of your finances that are causing stress. Engage your CFO, your accountant, your business consultant, or your coach (preferably a business coach, not a coach who is making income claims in their marketing and promising you the same results) to help you troubleshoot and think creatively about actions you can take.
Focus on what you can control
Shift your focus from dwelling on financial stressors to taking proactive steps to address them. Get help to break down overwhelming tasks into manageable action steps, and prioritize tasks based on their impact and urgency. Contact your mentors or experts in areas where you need support.
Develop a plan
Take a proactive approach to managing future financial stress by making plans. Seek guidance from financial advisors or accountants to develop strategies for reducing debt, increasing revenue streams, and building financial resilience.
Ask for help
When you’re feeling depressed, these things can be hard to do on your own, so asking for help can make it much easier. Even a simple accountability partnership with a business buddy can be a small step forward.
Caring for your depression as a business owner
Living in a culture where the medical model dominates means that we assume we can take a pill or engage in a one-off intervention that will make the problem go away. For many people with depression, situational or otherwise, it can’t be made to go away. It has to be lived with and cared for, and possibly alleviated, but not always (I don’t say this to make you feel hopeless but to connect with those of you who have depression that isn’t going away).
One of the shifts in thinking that needs to occur in relation to depression is away from cure and toward care. We need to ask, “How can I care for myself in my distress?”
The purpose of self-care in depression is to offer yourself care when you’re down and need it most. Self-care isn’t a tool with an outcome; it’s a process that smooths a journey that otherwise would be much more difficult.
Depression is not a choice, and individuals cannot simply “will” themselves to feel better. It is a condition that requires appropriate treatment, including therapy, medication, lifestyle changes, and support from healthcare professionals and loved ones.
Here are some concrete steps you can take to care for yourself when you’re facing depression:
Step 1: Break the silence
Using your discernment, choose one or two people you can trust and let them into your experience.
If you’re not having depression, but you know business owners who are, foster an open dialogue and have destigmatizing discussions about depression and spending money. Share your own story when and as relevant.
Creating a supportive culture within entrepreneurial communities in which it is the norm to discuss struggles and support one another can help reduce feelings of isolation and shame.
Step 2: Treat yourself with kindness
During times of financial stress and uncertainty, talking down to yourself makes a difficult experience worse. Instead, treat yourself with kindness by reminding yourself that nothing is wrong with you. Setbacks and so-called failures are part of the entrepreneurial journey and do not define your worth or potential. Mental health challenges are inherent in entrepreneurship. It’s not you; it’s the work.
To practice self-compassion, offer yourself the same empathy and understanding that you would extend to a friend facing similar challenges. It can help to do this in writing to give voice to both aspects of your experience, the part that’s having a hard time and the warm, empathic side that can offer comfort.
Step 3: Practice pleasure and relaxation
Engage in activities that bring you joy and relaxation, whether it’s spending time in nature, pursuing hobbies, connecting with loved ones, or moving your body in a way you enjoy. To get started, try listening to Yoga Nidra for depression, start booking regular massage appointments, or listen to music that uplifts you as a momentary positive mood induction tool.
Step 4: Build a support network
Using your discernment, surround yourself with supportive people. It is helpful to have a strong support network of friends, family members, mentors, and fellow entrepreneurs who can offer encouragement, advice, and practical assistance during challenging times. Lean on your support network for emotional support, brainstorming solutions, and celebrating successes, no matter how small.
Step 5: Contact a professional
Therapy or counseling can provide valuable emotional support as well as individualized tools and coping strategies for managing stress, anxiety, and depression. Online resources, support groups, and peer networks tailored to entrepreneurs’ unique experiences can also offer valuable insights and support.
Note: My Financial Therapy for Money and Trauma follows a compassionate approach to healing collective and individual money-related traumas so that you can create financial safety and well-being.
The Power of Vulnerability in Entrepreneurship
Once you feel like you have some capacity, consider sharing your story. By openly discussing mental health challenges, we create entrepreneurial communities with a culture of understanding, support, and genuine human connection. Your vulnerability is not a weakness—it’s a profound strength that invites empathy, connection, and collective healing for other entrepreneurs who struggle.
Depression and entrepreneurial success are not mutually exclusive. With the right support, strategies, and mindset, you can navigate these challenges.
Want support for caring for your depression or financial stress as an entrepreneur? Book a free call with me here.