When I was at university, my parents and I used to have the same conversation about my financial instability every three months.
They asked me why I was behind on paying my phone bill again, I told them I forgot (which I did).
My Dad would point to the new shoes I was wearing and say: “I think I know where that money went to”.
I would cry out of shame, promise them I’d do better and we moved on … until my next impulsive buy-a-thon.
It was a continuous cycle of forget, spend, cry and repeat.
As I transitioned into adulthood, the consequences of my reckless spending habits became more severe.
The desk drawer stuffed with unpaid bills became fuller and fuller. I got in trouble with my phone provider and was threatened by debt collectors. Worst of all, it put a strain on my relationship with the people I love most.
I knew I was out of control and the guilt consumed me.
Even though I was diagnosed with ADHD long before my problems with money began, no-one had ever made the connection between my disorder and my empty bank account.
In my mind, ADHD only existed inside of a classroom. In the “real world”, my impulsivity and short attention span were simply chalked up to voluntary incompetence by my family and peers.
But the cause of my money issues was looking me square in the eyes. I just couldn’t stay focused long enough to see it.
So I investigated the issue for the ABC Personal Finance series.
A pattern of financial behaviour
Between 2 and 4 per cent of Australian adults live with ADHD.
It’s a disorder that to this day is deeply misunderstood and stigmatised.
Some call it a cover for laziness and stupidity. Last week, my taxi driver believed it was a disorder fabricated by big pharma to sell stimulants to children.
But ADHD is a chronic medical condition that touches every part of a person’s life, from relationships to job security to financial health.
“People with ADHD are more likely to go into debt, impulsively spend and argue about money with their partner or spouse,” leading expert in ADHD and money management Dr Stephanie Moulton Sarkis says.
In her practice in Florida, Dr Sarkis coaches adults with ADHD on a daily basis to better manage their bank accounts.
Over the years, she started to notice a pattern in her clients’ stories.
They were living pay check to pay check
ADHD is often accompanied by a lack of long-term planning. As Dr Sarkin explains, “saving up, for people with ADHD, can be extremely hard because they expect big results right away”.
They may start a savings account, only to empty it out the following week because they don’t have enough money left for groceries.
They were not taking shopping lists to the store
Shopping lists have a very staid reputation, but not taking an organised list with you of what you need, often leads people with ADHD to act more aggressively on what they want.
Going to the supermarket without a plan means I leave with four pints of ice cream, two bags of chips and six facemasks instead of a nutritional dinner. Making a list allows you to set limits on what you buy so that you don’t overspend.
They were impulse buying
A lack of impulse control is one of the main characteristics of ADHD. Think Ariana Grande in her song 7 Rings: it’s a typical case of, “I see it, I like it, I want it, I got it.”
But chances are you’re not a globally renowned popstar with millions in the bank who can afford spending $250 on a face cream.
Taking out loans at high interest rates
Adults with ADHD are far more likely to engage in risky financial behaviour.
This often means impulsively taking out expensive loans without thinking through the long-term consequences of that decision.
The patterns Dr Sarkis identified in her practice are the result of miscommunications in the brain. Specifically the pre-frontal cortex, which regulates decision-making and impulsivity.
The role impulsivity plays in overspending
ADHD is a condition described by three symptoms: problems in concentration, impulsivity and overactivity.
This doesn’t mean that all people with ADHD are exactly alike. Different people can have a different balance of those three symptoms.
Even though all of them play a role, impulsivity impacts financially struggling adults with ADHD the most.
“In ADHD, people tend to make slapdash decisions which often leads to overspending”, ADHD expert Dave Coghill from the University of Melbourne says.
“On the other hand, the lack of attention means that we also don’t focus on how much we’ve got,” Professor Coghill said.
Professor Coghill explains that impulsivity comes in three forms: emotional, action and cognition.
In terms of spending, that looks a little something like this.
You just had a bad day at work. You’re tired, cranky and upset.
Rather than going home, you spontaneously decide to go the shopping centre (impulsivity of action) and get yourself something nice to cheer you up (emotional impulsivity).
Within 10 minutes you are back outside, $300 lighter and carrying a full-size shopping bag to the bus stop.
This is the typical act now, think later mindset associated with impulsivity of cognition.
If you recognise yourself in this scenario, I am here to tell you that you’re not wilfully irresponsible.
The pre-frontal cortex that helps us to control our impulses and inhibit inappropriate actions isn’t strong enough in people with ADHD.
“It is that part of the brain that acts as the checks and balances, which either is or isn’t a fantastic pun for money management,” Professor Coghill said.
Of course, this doesn’t mean you don’t have the power to change your relationship with money.
Tips for how to better manage your wallet
Dr Sarkis tells all her new clients the same thing: No matter what your financial position is right now, you can improve it. It may take time. It may frustrate you. But it gets better.
Here are her six tips for getting your finances in order if you suffer from ADHD.
Find a treatment for ADHD that works for you
It might sound obvious, but it’s true: you cannot fix your money problems if you don’t address the underlying issue.
Talking to your doctor about what medication or therapy options are available is the first step.
It all comes down to learning how to make your ADHD impulses manageable by understanding your triggers.
This will help you handle your money better in the long run.
Talk to a counsellor about the feelings of anxiety and depression you may have about your finances
People with ADHD often have debt. This can have a negative impact on both your emotional and your physical wellbeing.
People with ADHD don’t tend to deal well with stress or discomfort, so it can be very beneficial to talk to a neutral party about any concerns you might have.
Dr Sarkin even recommends having a both a therapist and a financial planner in the room with you.
Take a good look at your finances with either a trusted friend or financial professional
I know that in my case, nothing sends me into attention deficit frenzy like a long list of numbers that do not seem to add up.
As Dr Sarkin points out, “people are often afraid to peek over the cliff and look at where they stand, when it fact it could be empowering.”
Having someone to help you figure out how much money you’re spending compared to how much you owe, gives you an overview of what is happening in your bank account.
Start using a budgeting app
If there was one thing I took away from my conversation with Dr Sarkin, it’s that budgeting apps are tremendously helpful for people with ADHD.
Most of her clients use one to pay off debt or build up savings.
That’s because people with ADHD are more visual, having an app that puts your finances into fun colourful graphs can be a positive reinforcement tool.
Make sure that you start building up your savings
I know you’ve probably heard this a million times before, but we all need a financial safety net.
“The goal is to have six months of living expenses saved up,” Dr Sarkin said.
By limiting your impulsive spending, you can start putting the money you previously wasted into a separate account. But remember this will take time, and results are not instant.
Read a financial article once a week
And make sure it’s from a reputable place. Even if you don’t get it at first, it’s a step towards financial empowerment.
Living life in the green
The ADHD money hell-hole can make you feel like you have no agency. It’s a dark and lonely place with a well-hidden exit door.
What took me out of it was admitting to myself that I wasn’t going to be able to fix this issue on my own. I, too, needed help.
After a lot of hard work, therapy and copious amounts of tissues, I can say that I’m finally learning to manage my money in a healthy way.
Sure, my hands still itch every time I walk past a makeup display. The impulse to buy everything in sight doesn’t just magically disappear.
But when it does pop up, I wait and let it subside. After all, I kind of like my cosy spot in the green.