This article previously appeared on Credit.com.
Ten years ago I was a successful middle-aged professional with a six-figure checking account, substantial investments and an enviable rental real estate portfolio. I was happily on track to my first million. Today I am a 51-year-old woman with little set aside for retirement, living paycheck to paycheck, and a very long way from financial independence.
Am I just another casualty of the global financial meltdown? No, my financial meltdown was very personal and localized. I call it my “manic money meltdown” and it was caused by my bipolar disorder.
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Bipolar Mania: A Perfect Storm for Money Woes
You’re probably familiar with the concept of a “perfect storm” — a convergence of forces or circumstances that work together in the worst of all possible ways to magnify the intensity and impact of an already negative event. Well, undiagnosed and/or untreated bipolar mania creates the perfect storm for debt, overspending, ruined credit and financial chaos.
Each of the individual symptoms of bipolar mania can create a predisposition for poor financial decisions. But when several, or all, of these symptoms are combined, the likelihood of money problems compounds and amplifies.
The disordered thinking of bipolar mania and irresponsible financial behavior share the same dark core. Wish fulfillment, selfishness, delusion, deceit, egomania, self-gratification, escapism — words often used to describe the psychic landscape of the financial profligate — are strikingly similar to the experience of mania.
My Mania and My Money
My money meltdown involved a combination of extravagant spending on clothes, luxury hotels and first-class international travel; time out of the workforce while I pursued irrational business and personal schemes; and a ruinous divorce brought on by own crazy selfishness, infidelity and bizarre delusions.
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Many people with bipolar disorder go years before receiving an accurate diagnosis and effective treatment. One of the ironies of my situation was that I had been seeing a clinical psychologist for weekly therapy throughout the period when I was shopping compulsively, liquidating my assets, throwing away my career, booking round-the-world trips and destroying my marriage. But bipolar disorder is so little understood that my psychologist completely missed it.
By the following year, I’d fled my marriage and made the strange decision to pay for an expensive graduate program unrelated to my profession at a university on the other side of the world. I ended up seeing the college psychiatrist. After several sessions, she diagnosed acute anxiety and began trying to find a helpful medication. Then my casual mention of weekend furniture shopping (I had spent thousands on exquisite Italian furniture for my run-down, temporary student apartment) set off her alarm bells, which led to my bipolar diagnosis.
Spending Sprees, Gambling and Lost Jobs
Pinpointing bipolar disorder frequently involves a psychiatrist asking a patient if he or she has indulged in unrestrained buying sprees, made any foolish business investments or spent (or wishes to spend) significant amounts of money. That’s because bipolar mania is often characterized by extreme grandiosity — a state of mind where there are no consequences and no limits.
Imagine simultaneously winning $1 billion in the lottery and having only six months to live. That's what bipolar mania feels like: Not only does money appear limitless, it seems there will never be any day of reckoning.
During the mania, some people simply give away money or possessions. Others spend large amounts on purchases that make sense only to someone who is manic — for example, maxing out a credit card to buy everyone you know a snakebite kit.
Bipolar disorder can also provoke a gambling spree. One man I know sold his Rolls-Royce for only $20,000 then lost every dime within 24 hours by playing poker.
Some experience mania as a state of anger and paranoia and may lose their jobs or trigger expensive legal problems by creating chaos and conflict. (People disabled by bipolar disorder may be unable to return to the workforce. Social Security disability payments are available in these circumstances.)
Since substance abuse and bipolar disorder frequently occur together, drugs and alcohol can empty bank accounts and cause substantial debts. Giving someone in a manic state access to credit is like enabling a drug abuser.
Poor judgment can also prove ruinous. Actress Patty Duke and writer Patricia Cornwall, both of whom have bipolar disorder, lost large sums of money to business “managers” no rational person ever would have hired.
The Best Day of My Life
In my case, the manic money meltdown did have one positive effect. It was my crazy spending that led a psychiatrist to finally understand what was really wrong with me.
In a sense, the day I was told I probably had bipolar disorder was the best day of my life. The diagnosis shocked me initially, but I’ve since flourished with medication and therapy and haven’t had a serious episode of mania or depression for eight years.
I also now have a wonderful fiancé, and we plan to marry this summer. We have been slowly combining our finances and recently bought a home together.
The 4 Tools That Help My Fiancé and Me
You may be wondering: How can my fiancé trust me with money? Why would he mesh his hard-earned and carefully managed money with the little that wasn't squandered by me, the ultimate financial train wreck?
It’s because bipolar disorder is episodic. In between bouts of mania or depression, people with bipolar are “themselves.” During these periods of wellness and rationality, you can put in place safeguards to protect both yourself and your family in the event of a serious mood swing.
My fiancé and I have enjoyed a long period of stability and we hope it continues. But we both know relapse is always a possibility. For that reason, we use four tools that provide us with peace of mind about our finances and everything else:
1. Mood charting. Every day, I rate my mood and make a few quick notes about my sleep, diet and exercise. This way we can see if I’m starting to enter a period of being either unusually “up” or “down.” It also keeps us attuned to other red flags, like missing sleep or slipping into the sort of poor lifestyle choices that tend to trigger a bipolar episode.
2. A wellness plan. This is a blueprint that describes my personal signs of wellness and my signature bipolar symptoms. It also notes the daily activities that support my health, the signs that I’m becoming a little manic or depressed, and the kinds of intervention that typically get me back on an even keel.
I’ve also found that good nutrition is extremely important for my mental state and have even written a book, The Bipolar Diet, to share what I’ve learned about ways to keep weight down, energy up and moods stable.
3. A treatment contract. This is my written commitment to turn over all my financial and business affairs to my fiancé if I experience a serious mood swing. It also includes a power of attorney.
We have shared this contract with my doctor and psychiatrist, and I have agreed to accept all their treatment recommendations.
4. Transparency. My fiancé and I use Mint.com, a free Web service that automatically tracks our bank and investment accounts as well as our credit cards. The result is that we have no financial secrets or surprises.
It also means we can, and do, see exactly what we are spending and saving then fine-tune our budget when necessary.
How You Can Help Others
Bipolar disorder is a serious illness. It cannot be cured, but it can be managed. Bipolar is one of the most treatable of all mental illnesses.
So the next time someone’s financial behavior strikes you as crazy or irrational, stop and look closely. Temporary insanity — in the form of bipolar mania — may be the explanation, and psychiatric help can be a huge help for both the patient and his or her loved ones.