how do bipolar people avoid bad financial decisions while manic?

June 17, 2017 1:20 PM

I've been reading about bipolar people losing a lot of money during manic episodes by, e.g., over-estimating their blackjack skills or being too optimistic about a new business idea. This apparently happens even to people who know they get manic and sometimes repeatedly to the same person. Which makes me wonder, is there no way to structure one's finances to avoid this? E.g., could I instruct my bank to require a cooling-off period or a doctor's note before allowing withdrawals larger than some size, etc.?
posted by d. z. wang to Work & Money (16 answers total)

I think what you'd want to look at are the kind of legal relationships that are established for persons who have alzheimers or dementia or who might be unable to make their own financial or care decisions. One such legal relationship is the durable power of attorney. Alternately, you could probably hire a financial advisor type person to take care of your bills/finances or have someone maintain a savings account where you get a regular allowance to manage your day-to-day but not so much money that you wipe yourself out if you go on a bender.

I think a key question is how much damage can you do to yourself? Putting money into certain retirement vehicles can make it difficult to access and a financial advisor could help you there and that would keep you in charge, not cost too much in fees but be a check on yourself. Granted, if every month you are uncontrollably spending, you will wind up in trouble but maybe having a regular check-in for your health and include in that a report of your balances and spending might do the same thing with even greater benefits.

I wonder if there are forums for people with bipolar who might have discussed strategies of self-care in this area? I bet you would find some interesting tactics for management.
posted by amanda at 1:49 PM on June 17, 2017

A friend of mine will give her bank card to her mom or her partner when she knows she's on the verge of an intense mania. It has helped, but despite this precaution she has still suffered some pretty severe financial damage. For her sake I'm eager to find out if folks have better suggestions. Great question.
posted by prewar lemonade at 2:37 PM on June 17, 2017

If there is a real risk of this, you could keep only one credit card with a low balance limit and store the majority of your money in an online-only savings account, destroying any ATM card they might send you. That way it will take at least three days for you to access the cash, as you'll have to transfer it over to your main checking account. Checking account should of course be set up to deny overdrafts/no line of credit.

If you anticipate needing to be barred from access to your money for more than that period of time, yeah, you're talking about giving the majority of your money to a trustee or guardian.
posted by praemunire at 3:00 PM on June 17, 2017 [3 favorites]

Gaby Dunn from Bad With Money talks about this issue some. She mentions having savings accounts that she can’t access through her financial planner.
posted by tooloudinhere at 3:21 PM on June 17, 2017

Interesting challenge. You want to limit your power, but not give it away entirely. One piece of the solution might be a security token.

On my keychain sits a widget my bank gave me to ward off identity theft (which is a bit analogous I guess). My banking password is my 4-numeral PIN, plus the six digits that appear when I press the button on my widget. The six digits change, so they're only good for a 30 second window.

If I were to make someone else the Widget-Keeper, then I couldn't enter the password without phoning/texting that person first. And the Widget-Keeper could never access my account at all, because they wouldn't know my PIN. Access could even require my fingerprint.

I can still use just my bank card for everyday things, like getting cash back while buying groceries.
posted by feral_goldfish at 3:35 PM on June 17, 2017 [10 favorites]

My dad went through bankruptcy as a result of an untreated manic phase. He has since gotten rid of all credit cards and revolving lines of credit at the bank, and my stepmom manages the finances. It seems to be helping.
posted by joan_holloway at 3:53 PM on June 17, 2017

Several of the people with bipolar who I know personally have opted to close all credit card accounts so they can't do damage beyond their cash reserves. (I suppose they COULD raid their retirement accounts, but not as impulsively, and so far that has not happened, as far as I know.) Some have partners or family members handling most of their finances and giving them a monthly allowance for discretionary spending.

A bipolar forum or support group (DBSA is often a good place to start) would probably turn up other good suggestions.

I will note that there was at least one time when not having access to a credit card at all has caused some problems for a loved one. So it might be advisable to have one with a very low limit, or have one that a family member holds for emergencies, or some such thing, depending on your risk tolerance.
posted by Stacey at 4:13 PM on June 17, 2017

On the tiny point about blackjack in your example, in lots of places you can "self-exclude" from all state casinos and get yourself put on a banned list so you simply won't be allowed to gamble.
posted by Eyebrows McGee at 5:45 PM on June 17, 2017 [5 favorites]

You can put accounts and property into a revocable living trust—a good idea anyway for a variety of reasons—that has specific rules regarding how much can be withdrawn from the trust at once or in a given period of time. Your bank will then be obligated to comply with those limits if you retitle accounts into the trust, and any attempts to put a transaction through that exceeds that amount will be flagged and subject to approval by the bank's management. There can be ways to get around it, and of course one could always revoke the trust, but that would take time, and it's definitely a barrier that might stop someone from proceeding while in a manic phase.
posted by limeonaire at 6:28 PM on June 17, 2017 [1 favorite]

On a more low tech level I've seen the recommendation to freeze one's credit cards in a block of ice.
posted by bq at 6:31 PM on June 17, 2017 [3 favorites]

SSI recipients who are unable to manage their funds are appointed representative payees. When I worked in social services, I had clients with payees who typically managed savings and routine payments such as rent, utilities, etc. and either gave the remaining funds to the client in a monthly lump sum or on an as-needed basis. If the client needed to access savings, they discussed it with the payee.

I imagine that something similar could be worked out in the private sector with a trusted* friend, relative, or even attorney through a power-of-attorney. The key would probably be having income/assets in an inaccessible bank account with transfers to an accessible account. Efficiency could be improved with routine payments on auto-pay from the inaccessible account.

*This person would have a HUGE amount of power and choosing them is not something to be taken lightly.
posted by charmcityblues at 7:02 PM on June 17, 2017 [1 favorite]

"You can put accounts and property into a revocable living trust—a good idea anyway for a variety of reasons"

This is rarely a good idea and most often a cheap-ass lawyer scam to extract maximum fees for minimum benefit to the client and/or as a scammy tax dodge. They're on the IRS list of dirty dozen tax scams. AARP also warns they're typically a scam. They are being aggressively prosecuted by several states' attorneys general. There are a small number of cases in which they're appropriate, but they're definitely not "a good idea for a variety of reasons." Someone with BPD trying to protect their assets from themselves should definitely not do this without consulting with a trust & estate attorney who DOES NOT advertise revocable living trusts, because most attorneys who advertise them are selling the scammy kind (with a very few exceptions).
posted by Eyebrows McGee at 7:50 PM on June 17, 2017 [11 favorites]

The best way to prevent the overspending is social. Weekly or biweekly therapy, with the therapist as an accountability check, helps.

As a purely practical matter I would not want to freeze funds this way. You never know when there will be an emergency (eg, leaving abusive spouse, landlord forcing you to move out) that requires an immediate cash injection.
posted by crazycanuck at 9:08 PM on June 17, 2017

I do not have bipolar disorder, but I have a history of impulsive overspending. One thing that's helped me is maintaining the bulk of my savings in a CapitalOne 360 account (formerly ING). To use the money in my account, I have to transfer it to my regular checking account which usually takes about 2 days. For me this means I don't use it impulsively - I use it when I'm ready to spend it on one of the things I'm saving for.
posted by bunderful at 7:44 AM on June 18, 2017

I set a chunk of my paycheck to automatically transfer into a savings account each payday, so it's not immediately available unless I do some work to make it available. That helps.

Got rid of credit cards, period. I have a Visa debit card. Because I'm me, I've memorized the number so freezing (literally) the card won't help and shopping online can be a little dicier, but if i get to making less than optimal purchases I can only go as far as my checking account has funds. That also helps.
posted by mcbeth at 12:27 PM on June 18, 2017 [1 favorite]

I have a bipolar relative who lives alone. She has hired a lawyer to control her finances. Her pension goes into an account and he pays her regular bills out of it, and transfers a kind of allowance into her personal account on which she has a debit card. If she wants to spend extra money say to replace the washing machine, she talks to the lawyer and he has to approve it and then pay the bill.
It's a shame she has to give up so much freedom, but she otherwise would not be able to keep a roof over her head.
posted by w0mbat at 5:14 PM on June 18, 2017