The Lasting Effect Trauma can have on your Finance

Trauma is a pervasive aspect of our society that affects every aspect of the lives of those who have experienced it. 

This article will discuss some of the main effects of trauma on personal finance. 

Trauma is “an emotional response to a terrible event.” It occurs when the extreme stress of the event(s) overwhelms the person’s ability to cope.

What is Trauma?

Researchers surveyed over 17,000 individuals about their childhood experiences and correlated them with later life outcomes.

Adverse Childhood Experiences (ACEs)

The reason for these outcomes can largely be blamed on the impact of trauma on the developing brain, and it all has to do with stress.

Trauma and the Brain

By now the effects of trauma on personal finance should be becoming clear. Not only might experiencing trauma inhibit a person’s ability to make money, it often leads to a plethora of habits and behaviors that negatively impact spending and money management.

The Effects of Trauma on Personal Finance

First, some of the outcomes named in the ACEs study related to personal finance include limited access to opportunities that would help one develop skills and make money, such as college.