Social Work and Money: We Need to Talk About It
By Reeta Wolfsohn, CMSW, and Matthew L. Schwartz, MBA, CFSW, LMSW, CASAC-T
Social Work Today
Vol. 21 No. 4 P. 18

No one chooses to have money problems, but most people do.

It costs money to wake up every day. If you are a woman, have an illness or disability, are older, uninsured, have a low credit score, or fall into any one of countless other categories, it may be more expensive for you than for others.

Money doesn’t grow on trees, it isn’t the root of all evil, and it can’t buy happiness, but financial health is foundational to everyone’s physical, emotional, mental, and social well-being, including that of social workers and their clients.

Many Americans are financially illiterate, which, naturally, creates numerous problems. In fact, 73 million U.S. adults are struggling financially, and more than 65% are financially illiterate and unable to manage their finances, according to Sherwood’s 2020 dissertation "Differences in Financial Literacy Across Generations.”

Financial social work began in 1997, when the term “femonomics,” or gender of money, was coined. Seven specific characteristics of the gender of money were identified, including the fact that women earn less, are frequently charged more for various goods and services, often find it necessary to take more time out of the workforce, and live longer (often in poverty). Because men also face money challenges, in 1995, femonomics became “financial social work.”

Since then, the world has changed significantly, but the inclusion of a more transparent, directed, psychosocial behavioral model that goes beyond budgeting and crisis intervention has yet to be fully embraced or adopted in the practice of social work.

The Pandemic’s Impact
Most Americans’ prepandemic financial circumstances were perpetually at risk. Seventy-eight percent were living paycheck to paycheck, and 40% believed that winning the lottery was the only way they would ever be able to retire.

COVID accelerated the financial decline of millions of financially fragile men and women, including social workers, as they lost their jobs, friends and family members, homes and apartments, food security, and much of what was known and familiar.

As the reality of pandemic life emerged, everything from work to toilet paper grew uncertain. The inequities of being a health care or frontline worker as opposed to a professional working from home were revealed. Isolation, illness, and deaths increased alcohol and drug consumption and online shopping exploded. It was the new normal.

The terms “long-term COVID” and “long haulers” refer to the virus’ long-lasting physical effects on survivors. They are real and serious, as will be the prolonged financial consequences of the pandemic for too many Americans.

A significant portion of the population will find itself in greater jeopardy as stimulus checks, relief programs, and rent, student loan, and unemployment subsidies end, and the actual costs and consequences (required repayments) are disclosed.

As a result, social work services will be in high demand even though many nonprofits closed their doors during the pandemic. The need for services will be broad and diverse, with much driven by financial problems that many didn't know how to prevent and have no idea how to remedy.

The need to change behavior, learn new money management tools, and develop better coping skills is obvious, but the ability to do so will be hindered by financial stress, anxiety, and trauma.

The need for well-trained, financially literate social workers (financial social workers) is now more important than ever and will be critical to assisting clients, communities, and institutions in recovery from the events of the past several years.

Not All Debt Is Bad Debt, but Most Is
Debt happens, but, in many cases, doesn’t have to.

Credit card expenses, student loans, car loans, mortgage payments, and medical bills come in as many shapes and sizes as the millions of men and women struggling to repay them. These debts are traumatizing for those lacking the financial or emotional resources to cope.

Debt may prevent someone from buying a house, renting an apartment, qualifying for a job, getting married, or starting a family. For those struggling with their debt alone and steeped in shame, guilt, fear, and hopelessness, it is easy to blame money for all their problems.

Of course, money didn’t create their problems—financial illiteracy and money avoidance are the culprits. When you have more months than money, more debt than assets, and more financial problems than solutions, thinking and behavior may become illogical.

The United States began building its “consumer economy” (more and more people buying more and more stuff more and more often) at the end of World War II. It began with modest homes in the suburbs, refrigerators, and automobiles. Next came televisions, which sold the public on grand possibilities and assured it that if the items it desired weren’t affordable, credit cards were the answer. Buy today, pay tomorrow.

As consumerism expanded, it proved to be good for the economy but bad for consumers who were excited by the instant gratification of fulfilling their wants but unaware of the long-term cost and emotional toll. We became a nation dependent upon tomorrow’s dollars to pay for today’s spending.

A barrage of social media, surveillance capitalism, financial illiteracy, artificial intelligence, 72-month car loans, disinterest in budgeting, and a lack of emergency funds only begin to explain why it is easier than ever to fall into debt and more difficult to escape.

American consumers have disconnected from their money. Not seeing or touching it makes avoiding it easier but inevitably exacerbates financial problems and contributes to depression, abuse, crime, self-medicating, divorce, domestic violence, and other social and mental health issues.

People from every race, religion, culture, and socioeconomic background need help grappling with huge debt, small or no savings or assets, and financial instability. These circumstances categorize and label them in ways that make life more difficult and can lead to a negative relationship with money and self.

Relationship With Money and Self-Theory
Postpandemic financial hardships will not be resolved using the outdated processes that created them.

Our thoughts, feelings, attitudes, and beliefs about money develop early in life—more often from observation than instruction and usually when we are not paying attention. They create the financial lens through which we view money, ourselves, others, and the world. Unfortunately, that lens is too often distorted.

Once that lens clicks into place, it becomes the foundation upon which financial behavior (how we earn, spend, save, share, and borrow) is built. Each of the five behavioral elements is actualized by an individual’s relationship with money and relationship with self.

The theory of relationship with money and self enables clients to move beyond the traditional financial education and literacy focus of debt, budgets, emergency funds, bank accounts, and crisis intervention to the more pertinent ones of values and experiences.

Knowing when, where, from whom, and even whether you were taught about money matters. Recognizing you were never taught this life skill (as is the case with most Americans) results in a social, not personal, deficit and is the initial step toward financial healing.

If you have applied your knowledge to help create the best financial circumstances possible, you are part of an elite group. If what you know has not created the desired outcome, it is because knowledge matters, but it isn’t the core of financial health and wellness—your relationship with your money and self are.

Someone’s relationship with money and self is influenced by family, age, experiences, religion, culture, society, gender, and countless other factors that evolve over a lifetime. In childhood, those factors are influenced by the people closest to you.

Factors include the following:
• Growing up, did the family discuss money?
• Were there financial problems? Was it a constant struggle to make ends meet?
• Did you feel safe and protected financially, or did you live in fear of not having enough money for food and rent?

As someone grows older, the role of friends, instructors, colleagues, partners, and spouses take on greater significance, as do social media and the media in general. From early childhood, your relationship with money is reflected in every decision, especially those involving how you choose to earn, spend, save, share, and borrow.

The theory of relationship with money and self makes the complex and emotional topic of money management less confusing and intimidating and more approachable and personal. It removes overwhelmed clients from a confusing space filled with budgets and money management tools to a place that makes more sense and feels more controllable.

Shifting the focus from concerns and comparisons about income, debt, and investments to relationship with money and self reduces self-judgment and criticism to allow for examining more familiar and personal thoughts, feelings, attitudes, and beliefs. Most importantly, it is the core of financial behavior and where financial change and healing originate. The process is different for everyone but necessary for all.

Social Workers, Clients, and Money
There is a cost to being a social worker. It's physical, emotional, personal, professional, and financial. This universal truth is not universally acknowledged in the field.

With roots in helping the poor and volunteerism, social work is most often associated with scarcity, need, and lack of resources. The perception that no one goes into social work to become wealthy has become a self-fulfilling prophecy. This belief minimizes the impact of not earning enough to cover today's high cost of living, student loan repayment for degrees that cost the same as other professions, the expenses of licensing, supervision, CEUs, and on and on.

Social workers have the education, skills, tools, and ability to be leaders in the financial health and wellness field (recognizing money as a source of empowerment that maximizes physical, mental, emotional, and social well-being by improving financial health).

Regardless of the client population or specialty area, from parents and prisoners to domestic violence and divorce, from millennials and baby boomers to the poor and the wealthy, financial stress, shame, trauma, and problems often need attention.

Financial social work is at the intersection of social work, politics, gender, economic and social justice, and all inequity. It should play a significant role in each on the micro, mezzo, and macro levels.

At this time of massive food insecurity, growing homelessness, high student loan defaults, health care financial toxicity, increasing inflation, and endless troubling economic indicators, this work is more imperative than ever.

Practicing Financial Social Work
No one needs to know everything about money, but everyone needs to understand certain aspects.

Including financial health and wellness work in practices, workplaces, classes, conversations, and casework demonstrates recognition, approval, and acceptance of its relevance to social work.

As agents of change and advocates for marginalized groups and social and economic justice, providing a more positive, proactive, honest, and holistic process to help clients make peace and make friends with their money is a social work imperative.

Providing a safe, nonjudgmental space to learn and talk about the historically taboo topic of money can be life-changing for clients who have spent a lifetime hiding or protecting their money secrets or questions.

Healing the relationship with money (taking responsibility and ownership of financial well-being) and healing the relationship with self (financial self-discovery and self-care) is traditional social work with the addition of the money element.

Be prepared to talk about debt. Help clients understand they are not their debt, and they shouldn’t confuse their self-worth with their net worth but must know the basics of credit and debt because it affects so many aspects of their lives.

Teach and practice financial self-care. Use S.M.A.R.T. goals, financial boundaries, and the transtheoretical model of behavior change to help clients begin to identify which of their behaviors are helpful and which are detrimental.

Financial Social Work as a Core Competency
According to the NASW Code of Ethics, social workers are called on to advocate for clients, to continue and to improve our education, and to utilize evidence-based practices to assist and empower our clients and patients. These, and many other areas of the ethical code, call on social workers to learn the skills necessary to practice competently within the field.

Financial social work has at its roots in the transtheoretical model of change, the transformative model of learning, and mindfulness. Combined with financial literacy, it provides a powerful toolbox of evidence-based practices in which to engage with change at all levels of social work practice.

Given the importance and impact of finances on clients, agencies, and communities, financial social work should, rightfully, be considered a key component of social work education and a core competency. It should be studied and sought after as a key skill as much as cognitive behavioral therapy, dialectical behavior therapy, and eye movement desensitization and reprocessing within the clinical world.

For qualified health care providers, financial social work is a reimbursable intervention. In counseling sessions, it’s used to reduce symptoms associated with anxiety, depression, suicidality, shame, reoccurrence of substance use, stigma, trauma, and other expressions of societal dysfunction.

At the mezzo level of practice, understanding human financial behavior and having financial literacy (as well as the skills to teach it alongside behavioral change) is of paramount importance. Programs, colleagues, and agencies—each of which requires a working knowledge of how humans relate to money to effectively work together—strive to serve their communities and their client populations.

At the macro level, what good is understanding policy if we don’t understand the very real way in which that policy will impact our clients, and how our clients are going to respond financially? Without the lenses of both financial social work and the theories of human behavior, we intentionally choose not to remove the blinders that cause so much policy to land in a manner that is counterproductive and, at times, dangerous for clients.

— Reeta Wolfsohn, CMSW, was recently named a Social Work Pioneer for creating the Center for Financial Social Work (financialsocialwork.com). The Center for Financial Social Work offers certification along with free resources (e-books, webinars, and a free virtual monthly social work group, MONEY: Let’s Talk About It). Thousands of FSW graduates across the country and around the world use this psychosocial behavioral model to improve their own financial health as well as their clients’.

— Matthew L. Schwartz, MBA, CFSW, LMSW, CASAC-T, is a doctor of social work student and adjunct instructor at the University at Buffalo School of Social Work. Schwartz has his financial social work practice at Horizon Health Services in Buffalo, NY. His research is focused on implementation science to mitigate the impact of transgenerational financial trauma while expanding access to financial social work services. His work, podcast, blog, and research can be found at SocialWorkDesk.net.