What Is Money Dysmorphia, and Do You Have It?
If you worry about money, you are not alone. Money dysmorphia describes people’s anxious feelings when they worry about their finances, and the concept is gaining popularity. The catch is that many people who experience money dysmorphia actually have secure jobs and savings.
We’ll help you understand whether you have money dysmorphia. If you do, we’ll provide several mental health tips and practical financial advice that can help you create a feeling of security with your finances.
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Do you have money dysmorphia?
If you’re wondering whether you have money dysmorphia, here are several common indicators that might suggest you’re experiencing it.
- Excessive worry about finances
- Feeling like you are behind where you should be financially
- Difficulty setting financial goals
- Resistance to spending money on yourself
- High expectations of financial success
- Anxiety when opening your bank account
- Fighting about money in relationships
- Quest for perfectionism when it comes to finances
- Feeling guilty for not working
- Equating your net worth with your self-worth
- Difficulty enjoying life, especially things that cost money
If you relate to any of these, here is more information about money dysmorphia as well as tools and tips to help you improve your money mindset.
What causes money dysmorphia?
Several factors contribute to money dysmorphia, shaping how people perceive and interact with their finances. This often stems from a mismatch between financial reality and perception. For example, the Financial Times highlights how even high earners can feel anxious about not having enough money, underscoring how this mindset transcends income levels.
Social media
One factor that contributes to money dysmorphia is the influence of social media. As such, social media comparison is the primary driver of money dysmorphia. This includes comparison with peers, celebrities, or influencers on social media.
Particularly, Gen Zers and millennials see influencers and celebrities on social media showcasing luxury lifestyles and feel their finances are inadequate. Seeing perfectly organized kitchens or large homes can make viewers feel less-than, as if they’ve done something wrong with their finances.
Childhood
People’s upbringing and financial traumas can also create money dysmorphia. For example, if someone grew up in a home that was not safe or secure, they might still worry about becoming homeless or not having enough despite having a steady income as an adult.
The way caregivers talked about money or wealthy people during your childhood can also affect how secure you feel about having money. In this case, some people feel like they don’t deserve to have a lot of money, even if they work diligently at high-earning jobs.
Most clients I have worked with have less dysmorphia or anxiety in a general financial sense but more related to how they will have to live in retirement. This typically comes from an older parent who was not financially sufficient. They may have even had to help support their parent financially.
This is where having a strong financial plan with your financial advisor is helpful. It can help you grasp where you are today, where you are going in the future, and what that will look like. It also allows you to quickly pivot when things change, which is the one guarantee we have.
Rand Millwood, CFP®
5 strategies to overcome money dysmorphia
Money dysmorphia comes from having feelings of scarcity. People with high incomes can have money dysmorphia, whether it’s due to having an uncertain upbringing or concerns over job stability. If you want to overcome money dysmorphia, here are five strategies to help.
1. Reframe money as a tool
One helpful psychological reframe is remembering that money is a tool, not a number representing your self-worth. If you see money as a useful tool that can help you achieve goals and enjoy life, it can help to remove your emotional attachment to it.
2. Identify and challenge anxious thoughts
People learn about money from their upbringing. For some, that means they learned how to use money, budget, and invest, while others witnessed their parents fighting about money. These experiences can create financial anxiety in adults.
Although it can be painful, taking the time to reflect on your earliest money lessons can help you to identify where your anxious money thoughts come from. Once you know that, it’s easier to reassure yourself that your life now is not your life then. This can help to reduce anxiety that bubbles up.
3. Be mindful of social media
A literature review from the National Library of Medicine found that “social media envy can affect the level of anxiety and depression in individuals.” So if you notice making financial comparisons when scrolling, you’re not alone.
One way to improve your mental health is to unfollow accounts that trigger your money dysmorphia or use a social media blocker to limit your time on your account. It’s also smart to remember that what people show on social media is only a small fraction of their reality.
4. Examine your financial reality
It’s wise to examine your finances. Take the time to write down your actual income, savings balances, investments, and total debt. This can be a challenging exercise; however, sometimes, knowing your numbers (whether they’re where you want them to be) can help reduce some of the money anxiety you might be feeling.
5. Cultivate gratitude
Research from the Harvard School of Public Health shows that adults who practice gratitude live longer and have a “lower risk of mental distress.” One way to alleviate financial anxiety is to write down what you’re grateful for.
You’ll start to notice that many aspects of your life are a privilege to have or experience. Even something as simple as waking up in a safe home and having food in your refrigerator can go on your gratitude list.
As it relates to general money dysmorphia, having an in-depth personal budget detailing all income and expenses (including one-offs, such as annual insurance and car maintenance) along with a solid emergency fund for the unexpected is usually the best way to really get a hold of those feelings.
Uncertainty typically is what leads to anxiety, so removing—or at least reducing—that uncertainty is a great way to keep those feelings at bay.
Rand Millwood, CFP®
5 financial products to consider
Another way to improve your financial worries is to use specific financial products or services to better your money situation. Here are five examples.
1. Student loan refinance
If your student loan payments feel overwhelming, refinancing your student loan to one with a lower interest rate can help. With refinancing, you can consolidate several loans into one, making it easier to manage your payments.
Getting a lower interest rate on your student loans can make paying off your debt less stressful. It also helps more of your hard-earned money to lower your principal rather than towards interest.
Refinancing student loans has pros and cons, especially if you have federal loans. Take time to understand the benefits and drawbacks before refinancing.
2. Auto loan refinance
According to data from TransUnion, the average car payment for a new car was $745 a month in the third quarter of 2024. The average monthly payment for a used car was $526. If you have a high payment that adds stress to your life, one option is to refinance your auto loan.
If you don’t know how to refinance an auto loan, prequalifying with multiple lenders and getting quotes is an excellent first step. It’s possible you can lower your interest rate or get better terms on your auto loan. This can help you feel more secure with your finances, which can help lessen money dysmorphia if you’re experiencing it.
3. Debt relief program
Many debt relief programs are available. The downside of using a debt relief program is that you often have to stop making debt payments and allow your loans to go into default. At that point, debt relief programs can help you by negotiating with creditors on your behalf and settling your debt for less than you owe.
If you need support and someone negotiating on your behalf, a debt relief company can help. However, other options on this list, such as refinancing your debt, are a better choice if you want to maintain a good credit score during the debt repayment process.
4. Tax relief service
Ignoring your tax debt will add to your money stress and anxiety. Many options are available to pay your taxes over time.
If you’re concerned about paying your tax bill or you have back taxes, contact the IRS and ask about possible payment plans. Tax relief companies can negotiate your bills on your behalf and help you reduce your IRS debt.
5. Home equity loan
If you are a homeowner, another option is to take out a home equity loan and use the funds to consolidate higher-interest debt. However, a home equity loan has drawbacks, namely that a lender can foreclose on your house if you don’t make your home equity loan payments on time.
If you’re confident in your ability to make your payments, a home equity loan can provide relief by giving you set monthly payments for a specific term. This option is much better than having credit card debt with variable interest rates.
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