A report by the Aboriginal Healing Foundation on the impact of compensation payments for residential school survivors, their families and communities found both positive and negative stories and experiences.
Coming into a large sum of money can be “highly stressful and sometimes even traumatizing,” particularly when the money received is compensation for harms or discrimination experienced.
While many survivors turned compensation payments into a positive financial opportunity, others experienced an increase in problems such as drug and alcohol abuse, pressure from family for money, and targeting by financial predators.
The impact of coming into a large sum of money is sometimes called “sudden wealth syndrome,” which brings about issues such as:
- Increased anxiety
- Impulse buying
- Feelings of social isolation
- Moodiness
- Money-related ruminations (thoughts, fixations)
- Guilt that makes it hard to make decisions and undermines pleasure
The report recommended financial literacy training as key to supporting future recipients of lump-sum payments.