One may have a steady paycheck, a healthy savings account, and even a retirement plan in motion, but still feel like it is falling behind. If that sounds familiar, you might be experiencing “money dysmorphia”, a growing phenomenon where people develop a distorted perception of their financial health, regardless of what their actual bank balance says and the lifestyle they lead.
The term isn’t clinical (at least not yet), but it’s gaining traction as more people describe a persistent mismatch between their financial reality and how they feel about money. Borrowing from the concept of body dysmorphic disorder, money dysmorphia is about misleading thinking. Someone might constantly fear financial ruin, obsessively check their bank account, or, paradoxically, spend recklessly to feel “caught up” with others. It’s less about numbers and more about perception—and that’s what makes it so sneaky.
Hyper-connection
So what’s fueling this disconnection? A key factor is social media. Platforms once used to share life updates now operate like curated highlight reels of luxury, with designer bags, first-class vacations, and six-figure side hustles flooding our feeds daily. According to a recent Edelman Financial Engines survey, over 50% of people who spend more than three hours a day on social media admitted to overspending to keep up with their digital peers.
And it’s not just FOMO, since real economic pressures are part of the equation. Gen Z and millennials are the most affected, with 43% and 41% respectively saying they experience financial dysmorphia, according to a Qualtrics study for Intuit Credit Karma published last year. These are generations facing mounting student debt, rising housing costs, and a job market that often rewards gig work over a stable long-term job. Slowly, traditional financial milestones—like owning a home or building a family—are increasingly getting out of reach.
Checking in
The symptoms can vary. Some, to save money at all cost, avoid spending on basic joys like meals out with friends, driven by deep financial anxiety. Others spend impulsively, chasing short-term relief or the illusion of wealth. These patterns can damage both relationships and long-term financial stability, according to specialists in the behavioral finances field.
Ultimately, money dysmorphia reveals something deeper than budgets and bank accounts: our modern relationship with success, security, and self-worth. While it’s not a diagnosable condition, its effects are real. Addressing it means challenging the narratives we absorb online and reframing how we measure financial well-being of populations.
