8 Signs of Money Dysmorphia & How to Overcome It

Have you ever felt broke even though your bank account says otherwise?

If you answered yes, guess what? You are not alone. Numerous young adults experience the phenomenon called money dysmorphia, even when they are quite financially secure. Here are 8 signs of Money Dysmorphia that often manifest themselves in a person’s life through undue stress, poor spending choices, and at times, an overall lack of self-esteem.  

The term money dysmorphia describes a warped image that someone has about their finances. It is not about the figures in your bank account. It is more about how you perceive those figures. Other than mental stress, poor choices, and an overarching feeling of inadequacy, this mindset can also cause devastating effects in the long run.  

While we have previously discussed budgeting apps for managing finances, this post aims to help people overcome the feeling of having insufficient funds by providing actionable steps to combat this mindset. This blog will help you understand money dysmorphia and its symptoms step by step. Don’t worry; I will also walk you through strategies that can help you overcome it.

Content of this blog

I. What Is Money Dysmorphia?

Money dysmorphia can be defined as a disconnection between an individual’s observed financial status and their actual financial reality. It is quite similar to Borderless Morphia, where one’s perception is not linked to reality. This condition is often exacerbated by social media, comparison culture, and societal pressure.

According to Lindsay Brian Podwien, a certified financial therapist, money dysmorphia is the distance between an individual’s perceived financial value and their actual financial status..

A study by Credit Karma found that 43% of Millennials and Gen Zs experience money dysmorphia. This affects students, early job holders, and the financially stable.

II. 8 Common Signs of Money Dysmorphia and Financial Anxiety

You Always Feel “Poor” No Matter What Your Balance Says

Even though you have a stable income, you may struggle with financial anxiety and continue to feel insecure about your financial situation. This disconnects you from your actual financial status and your perception, which can be because of any experience or self-doubt pressure. As an example, individuals like Lisa Leach, who owns multiple properties and generates a significant amount, still feel financially unstable due to underlying anxieties. These lines of feeling can result in unnecessary stress and affect your ability to enjoy your financial achievements.

You Avoid Looking at Your Bank Account

The only thought of checking your bank balance produces anxiety, resulting in avoidance behavior. This can bring an outcome in missed bills, overdraft fees, or unnoticed activities related to fraud. Ignorance is a common method used for coping with financial stress. However, it sometimes increases the problem. Observing your finances often, even when it feels unfavorable, is significant for maintaining a proper money mindset and addressing the issues on time.

You Underestimate Your Worth or Income

You might minimize the earnings that feel undeserving of financial success, often connected to impostor syndrome. This very thinking can hamper your working environment, non-negotiation of eagles, or reduce the chances of getting promotions as well. Recognizing and cherishing your values, as well as standing up for fair compensation, is significant for financial growth and your self-esteem. Challenging the unfavorable thoughts about money and accomplishments can aid in bringing changes to such perspectives. 

You Overspend to “Feel Rich” Temporarily

Getting involved in retail therapy or making a lot of purchases offers a temporary high, masking deep financial insecurities. This activity is often caused by a desire to emulate the perceived lifestyle seen on social media or among friends or family. Additionally, while it offers short-term satisfaction, it can result in a long-term financial strain and an increased feeling of being undesirable. Coming up with healthier coping habits and understanding the triggers for such spending can help in ignoring the cycle.

You Constantly Compare Your Finances to Others

Now that everyone is on social media, scrolling through others’ pictures, looking at their lifestyle, and admiring it. Yes, we are one of them. Looking at people’s lifestyles can lead to a feeling of fear of missing out. This emotional crash of financial anxiety can result in the emergence of mental health issues such as depression, which are mainly reduced through negative beliefs around money. That is why it is important to overcome and label those roots of your money mindset and ignore the stress ahead.

You need to remember that social media only shows the aesthetic life of a person, and behind it is the same person who might be struggling with something. They would not show how much struggle they are going through throughout the day or how they are living their life. That is why focusing on your personal financial goals and achievements is important, and it can only help you in reducing the influence of these comparisons.

You Feel Guilty About Any Purchase

Even the expenses that are necessary to make trigger guilt, making you question every financial decision. This guilt can affect your ability to enjoy your earnings and result in excessive prudence. It is important to know the difference between senseless spending and important purchases. Practicing the aspect of mindful spending helps you in centering for whatever u earn and save.

You Obsessively Save, but Still Feel Insecure

Even when you save diligently, you never feel financially secure. This type of coding behavior can be caused due to past fear of financial instability and can prevent you from enjoying your life and making important investments. While saving is only prudent, it is also important to recognize when it’s driven by fear rather than strategy. Stabilizing savings with spending on needed experiences can improve both financial as well as emotional well-being.

You Think You’ll Never Be “Rich Enough”

It doesn’t matter how much you earn or save, you believe it is never sufficient. This shifting goal post phenomenon keeps you in a continuous state of financial dissatisfaction. This kind of mindset can result in chronic stress and prevent you from appreciating your financial accomplishments. Keeping up realistic, reachable goals related to finances and cheering every success can help in shifting this idea and bring in favourable impacts. 

III. What Causes Money Dysmorphia?

Monetary trauma from experience: The event of not having enough money throughout one’s childhood can trigger a long-lasting money anxiety or financial stress.

Societal Burden: At a certain point in time, society measures success with failures, pressuring the individual to achieve certain monetary goals. 

Lifestyle Inflation: Expenses increase with the rise in income, bringing an outcome of everlasting pattern of feeling financial stress.

Inadequate Financial knowledge: If one does not have basic financial literacy, they might not understand their own financial situation and misinterpret it.

Social media platforms outline such problems by highlighting the aesthetic and selected lifestyles, bringing an outcome of setting unrealistic monetary goals and creating issues for he viewers.

IV. Ways to Overcome Financial Stress: Acquire Financial Stability

The primary that can help in overcome financial stress is by resifting or changing your money mindset. Yes, it’s in your hands; all I can do is suggest ways to do it. So by centering on creating long-lasting financial stability, you can minimise the overall psychological pressure linked with controlling your finances. Follow these steps- 

Track Your Finances Without Fear

Understanding and facing your finances head-on is the primary step for overcoming money dysmorphia.  You can make use of budgeting apps such as Mint, YNAB, also known as You Need a Budget, or a simple Excel sheet to a journal to continuously track income, spending, savings, as well as debt. Looking after your actual numbers helps eliminate the fear of the unknown. With time, this habit can replace financial anxiety with clarity as well as control. This can help in turning money management from an emotional burden into a practical task, aiding you to feel more confident about yourself and your financial decisions.

Redefine What “Rich” Means to You

Various individuals struggle with money dysmorphia due to the fact they chase someone else’s version of rich. In place of comparing yourself to others or social media standards, identify what wealth means to you. Is it a freedom for you or a sign of debt? The ability to travel? Owning a home? Feeling secure? When you link your financial goals with your values rather than chasing the standards, you’ll find more satisfaction and peace.

Use Mindful Spending Techniques

The overall scenario of mindful spending interprets making money decisions with recognition as well as perception. Before every purchase, ask yourself- Do you need this? Does it link with my values or goals? Will I still value it in a week? This reflection helps you ignore any impulsive buys and overspending just to feel good about yourself temporarily. In place of this, your money goes towards things that truly add value to your life. Mindful spending can help you believe in urself and the decisions, reduce the sense of regret, and support a healthy lifestyle. 

Educate Yourself Financially

Well, we all know financial literacy is a powerful antidote to money dysmorphia. When you know the key concepts like budgeting, investment, debt management, and credit, you make decisions from a place of knowledge rather than guesswork or fear. What I recommend is to start small, read some of our finance blogs, listen to podcasts like HerMoney or The Budgetnista, or take free online courses on good platforms like Coursera or Khan Academy. The more confident you are with financial terms and tools, the more you feel in control of your financial reality.

Set Realistic Financial Goals

Unrealistic or dramatic goals often fulfill feelings of inadequacy; instead, make use of the SMART framework to set financial goals that are Specific, Measurable, Achievable, Relevant, as well as Time Bound. For instance, “save Rs 50,000 for an emergency fund in 6 months” is more actionable than saving more money. Break big goals into smaller steps and pat yourself every time you make an achievement. This builds rhythm and self-confidence, aiding you in tracking progress and staying motivated. When goals feel attainable, you’ll be less likely to fall into the trap of “never enough”.

Talk to a Financial Therapist (if possible)

If you have strong or overwhelming emotions about money, you can talk to a financial therapist.  These experts assist you in resolving restrictive ideas, economic trauma, or stress due to the fact they focus on the intellectual and emotional elements of money. They can provide personalized tactics to alter your money mindset and bring in healthier habits. While not accessible to everyone, even one or two sessions can offer deep insights and lasting tools for managing monetary well-being more effectively and properly.

V. Providing Real-Life Stories or Examples related to money dysmorphia

The problem is that real-life examples of money dysmorphia in India are not directly documented, even though this activity is increasing among Indian millennials and youngsters. However, a recent article outlines how social media influence and societal pressures offer financial anxiety even among those with stable incomes. We suggest that this aspect is not limited to any specific demographic and can impact individuals across different financial backgrounds. 

I present to you the story of Lisa Leach. She owns three rental houses and earns around $90,000 a year with her family. However, there is still a feeling of insecurity concerning her financial stability. She lives in a farmer’s cottage with her family, which is free of cost. She studies a chronic feeling of being broke, illustrating how human beings with money dysmorphia may be impacted through their economic state of affairs. This very condition can be categorized by a disordered perception of an individual’s financial well-being.

Please feel free to share any private stories you have with money dysmorphia in the comments down below.  Others would possibly feel much less alone after reading your experience.

VI. Conclusion

Young individuals who are trying to become financially independent are more likely than anyone to experience money dysmorphia. Through a proper understanding of the way financial anxiety impacts your slice of life and analysing its influence on your money mindset, you can take action and work towards financial stability. Making your relationship with money stronger is very significant for leaving behind financial stress.

Sharing this article with your family and friends will help them too. Let’s build a supportive community where financial wellness is promoted. Join the conversation below by sharing your experience with money dysmorphia or financial anxiety. Let’s promote a community that supports financial well-being rather than hiding it under the sheets.

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FAQ

1. What is money dysmorphia?

Money dysmorphia can be defined as a misrepresented perception of one’s financial status, where people feel financially insecure even if they are financially stable. This condition often leads to financial anxiety, excessive frugality, or overspending of money on non-essential things.

2. Is money dysmorphia a recognized psychological condition?

Even though money dysmorphia is not practically identified in a diagnostic manner, like the DSM. It is still acknowledged by various financial therapists and mental health professionals as a real phenomenon impacting financial behavior as well as the mental well-being of the individual.

3. What are the common signs of money dysmorphia?

Typical indicators include:

• Continuously feeling POOR despite having an adequate income.
• Avoid checking bank accounts or bank balances.
• Feeling guilty over unnecessary purchases.
• Saving excessively without a sense of security.
• Contrasting finances with others leads to distress.
• Believes that one will never be rich enough.

4. How does social media influence money dysmorphia?

Social media sometimes outlines a curated lifestyle, resulting in individuals contrasting themselves negatively, increasing the feeling of financial inadequacy, and exacerbating money dysmorphia.

5. Can money dysmorphia affect high earners?

Yes, even individuals with a good amount of income can experience these symptoms of money dysmorphia, feeling financial anxiety, or financial insecurity. Due to past experience, pressure from society, or personal beliefs about finances.

6. What causes money dysmorphia?

Various factors contribute, including:

• Childhood Experiences with Monetary Instability
• Cultural and societal pressure
• Inadequate literacy regarding finance
• Impact of social media
• Personal belief and attitude towards money

7. How can one overcome money dysmorphia?

Some of the strategies include-

• Continuously reviewing and understanding personal finances.
• Setting up realistic monetary goals to avoid being under financial anxiety or pressure.
• Practicing Mindful Spending
• Seeking financial education from experts.
• Consulting with financial therapists or counsellors if the problem gets deep or increases.

8. Is money dysmorphia linked to mental health issues?

Yes, it can result in or exaggerate conditions like anxiety, depression, and stress, influencing the overall mental health and well-being of an individual.

9. Are there resources to help with money dysmorphia?

Yes, resources include-

• Financial therapy as well as counselling services.
• Budgeting apps such as YNAB or Mint.
• Educational platforms like Khan Academy and Coursera can be useful.

10. Can money dysmorphia impact relationships?

Yes! It can result in conflicts over spending habits or keeping secrets regarding finances and distinctive financial goals, potentially putting strain on personal relationships.

Guys, remember you are not alone who is struggling with this issue. Almost everyone who is earning might have or would be feeling this at some point in time. Remember that it’s your mind, and controlling it is in your hands. “Have you experienced financial anxiety or money dysmorphia?