8 Unique Ways to Overcome Money Dysmorphia

What is Money Dysmorphia?

Dysmorphia occurs when there is a disconnect between reality and our perception. Therefore, money dysmorphia occurs when one has a distorted perception of their financial situation. Examples of money dysmorphia include…

• Obsessing about small expenses despite being financially stable and having a high net worth

• Buying a new, expensive car despite having significant consumer debt

• Constantly comparing your possessions (home, car, clothing, etc.) or financial situation to the perceived financial situation of others

Money dysmorphia can stem from a number of places, such as a history of financial trauma or instability, social media, reality tv, societal or familial expectations, etc.

Impacts of Money Dysmorphia

In the day and age of TikTok and Instagram, money dysmorphia runs rampant. According to Bloomberg, nearly 50% of millennials and Gen Z experience money dysmorphia. People with money dysmorphia experience frequent feelings of shame, disappointment, anxiety, stress, and overwhelm. These feelings can ultimately lead to unhealthy financial behaviors, including financial avoidance, financial hyper vigilance, financial hoarding, and overspending.

While money dysmorphia can feel all consuming, overcoming money dysmorphia is possible with time and consistency. Consider the following 8 unique ways to overcome money dysmorphia.

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8 Unique Ways to Overcome Money Dysmorphia

1. Learn The Truth About Influencers

Influencers curate their lives for social media. They carefully edit photos and reels to show you only what they want you to see. Influencers have been known to purchase name brand clothing to appear wealthy, only to leave the tag on their Prada jacket, so they can later return it. Similarly, influencers will rent a luxury vehicle and film themselves driving the Porsche around town - pretending they own it. Of course, not all influencers use these manipulative tactics but many do.

• Check out Hannah Alonzo’s YouTube channel, where she exposes influencer scams.

Additionally, the vast majority of influencers do not earn the millions of dollars they appear to earn. According to the Washington Post, just 12% of full time influencers or content creators earn more than $50,000 annually. Just 12%! Bear in mind, that 12% includes celebrities, so the number of every day people earning over $50,000 annually from influencing is very small. Meanwhile, the median annual income for US workers in 2024 is over $59,000 - the majority of ‘full time influencers’ are not keeping up with your 9 to 5.

2. Disconnect and Revaluate

Take a social media break for a week, a month, or even a year! Do not post a single thing about your life. Do not look at where your high school ex-boyfriend’s girlfriend’s roommate is going on vacation. While taking this social media break, notice…

• How often you make purchases or do activities for social media instead of doing them for yourself

• How often you are comparing yourself to others

• How your overall mental health and wellbeing has changed as well as your financial health and wellbeing

If taking a social media break feels too difficult, unfollow influencers and people that you do not personally know. Strive to cut the number of people that you follow in half - that’s right, challenge extended!

3. Fact Analyzing

If you are seeking out financial statistics or rules of thumb, make sure that you have a thorough understanding of the context surrounding the statistics.

For example, according to NerdWallet, the average net worth for US families is over 1 million dollars! If you were to compare your net worth to this number, you may fall short, resulting in feelings of inadequacy, shame, and scarcity. However, knowing that the over 1,000 billionaires of the country - Bill Gates, Warren Buffet, Oprah, Mark Zuckerburg, Taylor Swift, and Rihanna - are included in that average adds context to the statistic. Billionaires (and hundred millionaires) dramatically skew the numbers.

Additionally, this statistic is for ‘US households’ and does not indicate a specific age range. Someone early in their career is not likely to be close to a 1 million dollar net worth. Similarly, a single person may not have as high a net worth as a couple (especially those DINKS - dual income, no children). Finally, this statistic does not take into account where you live. Seattle’s minimum wage is over $20, while Tulsa’s minimum wage is just over $7! Despite cost of living differences, it is fair to assume that Seattleites will more quickly reach a 1 million dollar net worth than Tulsans.

• Read Factfulness: Ten Reasons We're Wrong About the World--and Why Things Are Better Than You Think by Hans Rosling to better understand statistics

4. Unpack Financial Trauma

A history of financial trauma or instability may be a source of your money dysmorphia. If so, consider working with a Certified Financial Therapist, who can help you to identify your triggers, explore your fears and anxieties, and reduce feelings of shame or inadequacy.

For many people, the idea of financial therapy can incite feelings of anxiety - after all, who wants to bear their most intimate financial feelings and experiences, financial feelings and experiences that are too taboo to even discuss with friends, family, and partners. However, in my experience as a financial therapist, clients often feel an immediate sense of relief after disclosing their financial feelings, as a weight has been lifted. Through ongoing therapeutic work, sustainable change is possible!

5. Fact Gathering

Gather your financial information. Write down your income, monthly expenses, assets, and debts. Pay attention to these numbers on a consistent basis to stay grounded in your financial reality.

Look at your savings and expenses over the past month and ask yourself…

• What purchases did I make or not make due to my money dysmorphia?

• Did I make these purchases for myself or for others?

• How does my money dysmorphia make me feel?

• What changes can I make in the month ahead to reduce feelings of shame, guilt, and regret?

• What changes can I make in the month ahead to increase feelings of pride, freedom, and confidence?

6. Compare with Yourself

If you are to compare at all, compare to your past self (proceed with caution when comparing of course). When we compare to others, we are comparing complete information about ourselves to incomplete information about others. When we compare to our past selves, we can celebrate the progress that we have made and increase feelings of motivation.

• Consider tracking your net worth (assets minus debts) on a semi-annual basis. Tracking your net worth semi-annually will help you to zoom out from the day to day, so you can better see the bigger picture and all the progress that you have made. Celebrate each milestone - reaching a $0 net worth, your first $10,000, your first $50,000, etc.

*Do not compare with your twin either - I just could not resist this picture

7. Increase Your Financial Education

You may be experiencing money dysmorphia in part due to a lack of financial education. While financial education is slowly making its way into schools around the country, the majority of us never received a formal financial education. While pursuing financial education may sound daunting, it will be worthwhile. Your knowledge will snowball with each book you read or podcast you listen to.

• If you would like to further explore your relationship to money, read Feel Good Finance by Aja Evans or Mind Over Money by Brad and Ted Klontz

• If you would like to learn more about investing, read Girls That Invest by Simran Kaur or The Simple Path to Wealth by JL Collins

• If you would like an introductory financial book, read I Will Teach You To Be Rich by Ramit Sethi or Broke Millennial by Erin Lowry

8. Daily Reminders

Finally, to combat money dysmorphia requires rewiring your mind. Reciting the following daily reminders (or creating your own) will help you to identify thinking errors as they occur throughout the day.

• “Knowing my friend’s income does not mean I understand my friend’s entire financial picture, and just as I do not share my financial anxieties with others, they do not share their financial anxieties with me.”

• “I make financial decisions based on what is best for me, not based on how I would like others to perceive me.”

• “My net worth does not equal my self worth.”

• “No one cares more about my money than me, and spending my money to ‘keep up with the Jones’ is a losing battle.”