How to Avoid Bag Lady Syndrome | 6 Ways to Combat Bag Lady Syndrome

Homeless Poverty Man | Bag Lady Syndrome | Featured

Are you afraid of outliving your money, becoming homeless, and ending up a bag lady?

This paranoia is called Bag Lady Syndrome. And it's not a made-up disorder; it's a real fear a lot of women experience.

Here are a few things that can help you deal with this financial anxiety.

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6 Things You Need to Do to Beat Bag Lady Syndrome

Homeless Woman Street Writing | Bag Lady Syndrome

What Is Bag Lady Syndrome?

Homeless Man | Bag Lady Syndrome

Bag Lady Syndrome is a term that was first coined in the '70s. It refers to the feeling of extreme financial anxiety or stress that some women have over their finances.

These women think that they'll lose their homes, carry their possessions in plastic bags, and live on the streets.

But this illness is no joke; it's a real worry. It's prevalent among women of all ages and socioeconomic statuses.

A study was conducted among more than 2,000 women with household incomes of at least $30,000.

Almost half of the participants are “sometimes” or “often” afraid to lose all their finances. They also fear experiencing homelessness in their elder years.

Even some of those with household incomes of at least $200,000 have the same fear!


According to the American Psychological Association (APA), women worry so much more than men when it comes to financial security.

They have financial worries all the time, and they struggle and experience stress just to make ends meet.

Bag Lady Syndrome can erode your physical and mental health. It can also strain relationships, impact your career, and make you feel alone.

Thankfully, there are some things you can do to avoid this problem. However, making more money isn't one of them.

How to Avoid Bag Lady Syndrome?

1. Know Where You Stand

Hand of a Woman Holding Cash and a Pencil | Bag Lady Syndrome

You must identify your position and responsibilities in your current situation.

Ask yourself the following questions:

  • What keeps me up at night?
  • What do I worry about the most when it comes to my finances and my future?
  • Are my investments working hard enough for me?
  • Do I need to save more?
  • Do I need to spend less?
  • When can I afford to retire?
  • Can I afford to stay retired, or do I need to work even after retiring?
  • What do I want to do with the rest of my life? Do I want to study again or travel the world?

Answering these questions can help you manage your financial stress as well as figure out your goals.

2. Take Action

Woman Uses Calculator | Bag Lady Syndrome

You don't want your life to come to a point wherein you need to sell all your assets just so you can get more money. This is why you must learn how to be in control of your finances.

One way to make you feel that you're in control is to take action. Look at your wealth as something you have to build over time, not something you own.

To help you with this, you may do simple things, such as:

  • budgeting
  • cutting your expenses
  • saving more money every month

When you budget your money, take into account your variable, fixed, and one-time expenses.

Ensure that you have a cash cushion that can cover your fixed expenses for six to nine months.

Your goal must be to build savings that can support your needs once you retire.

Afterward, visit your insurance coverage plans–your life, health, even your estate plan. Don't overlook their importance.

These plans can give you peace of mind, especially if you're supporting somebody else.

If anything happened to you, your loved ones can be assisted by these insurance plans.

In addition, the value of money depreciates over time. So you may also want to consider investing in equity.

This can offer your money potential growth to beat inflation.

3. Care For Yourself

Woman Reading a Book While in a Bathtub | Bag Lady Syndrome

Fortunately, there are things you can do to nurture yourself and help ease your financial stress. But don't worry, these activities don't have to be expensive. They don't even have to cost anything at all!

For example, you may enjoy some bubble bath, sing along to your favorite song, or simply stop to smell the flowers.

Value your comfort today as much as you value your future comfort. When you're reminded of the things that truly matter, your financial fear can recede.

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4. Prevent Regrets

Woman Carrying Tote Bags | Bag Lady Syndrome

Are you aware of your risk tolerance? Are you afraid to lose all your money to the point that you become overly conservative?

Do you save aggressively that you feel so guilty when you spend something for yourself?

Your risk tolerance may be different from others, and you may just want to exercise caution, but you also have to permit yourself to do the things you want.

Having irrational fears can just lead to missed opportunities, which can leave you with regrets.

You need to find that balance between saving and spending. This balance can build your self-confidence, make you feel happy, and help alleviate your financial stress.

5. Reach Out to Someone

Unrecognizable Female Psychologist and Patient | Bag Lady Syndrome

As you age, your financial life can become complex.

For instance, there can be a pay raise in your career, inheritance from your parents, or alimony from your spouse.

If you don't know how to manage your finances or are afraid to make financial decisions, it's never wrong to ask for help.

You may reach out to a family member, friend, or professional, like an accountant or financial advisor.

This can make you feel more optimistic and confident about your financial position.

6. Cultivate Connections

A Group of Friends Having a Picnic in the Beach | Bag Lady Syndrome

Life can get busy at times. With this, maintaining relationships can be a challenge.

However, these relationships with your family, friends, and co-workers can go a long way.

Social relationships can make you feel connected, safe, and secure. They can support you, especially when you're experiencing stress and anxiety.

So, go out there and socialize! Prioritize your social calendar, nurture your relationships, and deepen your connections.

Check out this video by Clever Girl Finance to learn how you can create a financial plan for yourself:

When you're stressed, try to avoid making poor decisions, especially when it involves your finances.

Instead, set realistic goals, put your plans into action, and commit to your well-being. These can help minimize your chances of developing bag lady syndrome.

How do you manage your finances?

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Do you fear having bag lady syndrome? Why are you afraid of it? What are you doing to minimize your anxiety over your finances?

Please share your thoughts with us in the comment section below!

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