The Enduring Financial Strain from COVID-19 for Many Americans

Despite easing COVID-19 challenges this summer, financial anxiety remains a significant concern, particularly for individuals who faced job loss during the pandemic.

Understanding the Complex Path to Recovery Through Our Mental Health Tracker

In the August update of the Verywell Mind Mental Health Tracker, Amy Morin, LCSW, explores the ongoing financial hardships and emotional challenges experienced by those affected by job loss during the COVID-19 crisis.

For insights from previous surveys on mental health trends in the U.S., explore our earlier reports.

The COVID-19 pandemic has deeply influenced all facets of life, triggering stress across personal relationships, parenting, work, and everyday routines. Thanks to human resilience and vaccination efforts, this summer has marked progress toward regaining normalcy.

Our latest Verywell Mind Mental Health Tracker reveals that Americans feel less disrupted by COVID-19 in daily life compared to the spring months. Whether this reflects genuine improvement or adaptation to ongoing effects, a shift is evident.

However, one major source of stress remains steady and significant.

Between April and July, financial stress linked to COVID-19 showed little change among U.S. adults. In spring, 33% reported moderate to severe financial impacts from the pandemic; now, that figure stands at 32%, even as other COVID-related stressors have declined by 5% to 6%.

These findings offer a glimpse into the recovery process and highlight populations that may be struggling to move forward.

Managing Financial Stress Amidst the Pandemic

Stress and anxiety often ripple through our mental and physical well-being, influencing daily functioning.

Evening stress can disrupt sleep, leading to fatigue and reduced motivation for activities like exercise the following day. This cycle can lower productivity and increase feelings of frustration, perpetuating stress.

Financial worries intensify these effects. With 27% of individuals citing money as their top stressor in the past month—compared to 16% naming COVID-19 itself—addressing financial anxiety is crucial.

Why Financial Anxiety Persists

Financial stress often requires tangible solutions beyond self-care or therapy alone. Job loss starkly illustrates this challenge:

36% of those who lost employment during the pandemic identify financial issues as their primary stress source, compared to 24% among those who remained employed.
62% of job loss survivors report ongoing strong financial impacts from COVID-19, versus 31% of those who kept their jobs.

Financial hardship can strain relationships, complicate basic needs like food and bills, and undermine self-esteem, turning money troubles into all-encompassing challenges.

financial stress illustration — Verywell / Joshua Seong

Consequently, only 26% of individuals who lost jobs during the pandemic report mental recovery from that experience. In the past 30 days:

46% struggled with sleep disturbances
39% showed reduced interest in leaving home (beyond health safety concerns)
39% experienced changes in eating patterns
33% felt increased irritability and 35% withdrew from social interactions
29% had difficulty concentrating and 27% noticed reduced productivity

Those without job loss reported these difficulties far less frequently. While pandemic stress affected many, unemployment and financial instability cast a particularly long shadow.

Identifying Who Is Truly Recovering

Many Americans feel they have bounced back mentally from pandemic hardships. Although recent data may not fully capture the impact of August’s Delta variant surge, it reveals disparities in recovery experiences.

Overall, 45% report substantial or complete mental recovery, 27% partial recovery, and 28% minimal or no recovery.

The groups most likely to report significant recovery include:

Older adults (71% of Silent Generation, 62% of Boomers)
Higher-income households (62% earning over $150,000)
White individuals (53%)
Males (51%, compared to 39% of females)

Those who were relatively secure before the pandemic tend to regain normalcy faster.

Conversely, Gen X (40%), Millennials (37%), and especially Gen Z (21%) report lower recovery rates. Lower-income groups also face greater challenges, with fewer than half of households earning under $75,000 feeling mostly or fully recovered. For context, the U.S. median household income is about $63,000.

COVID-19 is not only a health emergency but also a mental and financial crisis, particularly impacting younger workers, homeowners, caregivers, and those without substantial savings.

While money cannot cure all problems or prevent illness, financial stability plays a crucial role in reducing stress related to housing, health, and family support during turbulent times. In the pandemic’s uncertain landscape, financial resources serve as a vital lifeline.

Financial worries such as choosing between groceries and rent, managing credit card debt, eviction concerns, and uncertainty about unemployment benefits have long troubled many Americans. COVID-19 has intensified these dilemmas for millions, even as others begin to see the pandemic’s worst behind them.

Seeking Support for Financial-Related Stress

In the past month, 23% of Americans have contemplated therapy, but barriers—chiefly cost—often prevent access.

Most therapy clients have health insurance coverage, frequently linked to full-time employment, highlighting disparities for those unemployed or financially strained. While therapy may not resolve financial hardships, it equips individuals with coping mechanisms to better manage daily stress.

Explore More: Money and Mental Well-Being

Listen to The Verywell Mind Podcast episode featuring five actionable strategies to improve your financial and mental health.

For those without insurance or financial means, numerous free or affordable stress relief techniques exist, including:

Journaling
Gratitude practices
Mindfulness meditation
Building social connections
Deep breathing exercises
Low-cost therapy options

Effective mental self-care doesn’t require hefty expenses and can bolster resilience in facing ongoing financial and emotional challenges.

Survey Methodology

The Verywell Mind Mental Health Tracker conducts monthly surveys assessing Americans’ mental health attitudes and behaviors. Since April 28, 2021, it has surveyed 4,000 U.S. adults online, with samples reflecting U.S. Census demographics for age, gender, race/ethnicity, and region.

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