Mental Health: It’s Time for Investors to Watch Out.
The stock market is a great economic endeavor that gives investors the opportunity for their savings to flourish and their wealth to grow. The news headlines are ever so clear: “31-year-old self-made millionaire”, “Trader turns $1,500 to $1 million in 3 years”, the list is virtually endless. Those invested in the stock market have made so much money, that the American Dream has suddenly become achievable.
The world has created this false narrative that investing is a miraculous platform, but in reality, the stock market world is very risky since many have lost millions of dollars through digital investing platforms. The stories of people making fortunes off of the stock market create a false narrative; that the end result of becoming rich through investing can be so easily attained. However, it takes a little more thought and economic knowledge to succeed when investing.
RESEARCH AND NEWS
Everyone makes mistakes, but some don’t handle them well. To illustrate, many people invest their whole life savings in the market, only to lose it when a stock crashes, which results in unfavorable impacts on their mental health. Getting upset or being in a bad mood, however, is much different than developing serious mental illnesses that people have to deal with for the rest of their life.
Moreover, researchers have decided to dive deeper into this issue. According to a study from Oxford Academic (ranging from the years 1998–2009), “A 1000-point fall in the stock price index results in increased hospitalizations for mental disorders by the magnitude of 5.32% for men and by 3.81% for women”. The authors continue by mentioning that whether gradually or immediately, the stock market has had a direct impact on the psychological well-being of investors as stocks decline.
Recently, Forbes published a news article analyzing the death of a 20-year-old college student by the name of Alexander Kearns, who recently began investing during the COVID-19 pandemic. After spending some time investing in the digital trading platform Robinhood, Kearns admitted that “he had ‘no clue’ what he was doing”, especially with the high volatility of stocks during the pandemic. Ultimately, a screenshot from his phone proves that he had “a negative $730,165 cash balance displayed in red” and upon seeing this, (as his cousin mentions), “he thought that he had blown up his entire future”. In the end, Kearns committed suicide from shock. This tragic death is a significant example of how the stock market can not only cause increased hospitalizations or mental illness but more deleterious fates like death itself.
SOLUTIONS
There are various strategies to ease the stress that comes with investing. To go into further detail, Dr. Soeiro a Ph.D. and member of the American Board of Professional Psychology [ABPP] has a few tips on how investors cope with anxiety. To begin, a great starting point is to not take actions that are too risky in the first place, instead make financial actions that are in smaller steps and are more informed. It’s best to first inform yourself and then take financial action.
Speaking of informing, there is a myriad of organizations that offer investing classes that can be accessed easily, such as on the Internet or in cities nationwide. Some examples are ClikTrade with free online workshops for all, Money Experience with financial literacy for teens, The Impact Investor with great services for poor neighborhoods, and so much more.
CONCLUSIONS
Overall, investing is such a great way to make some extra cash or as a career path. But before making any important financial decisions people must inform themselves on how to invest properly. Otherwise, they might find themselves overwhelmed, regretful, and overall discouraged. Money is power, as they say, that is until the money overpowers you.
