How To Know If You Have Money Dysmorphia

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How To Know If You Have Money Dysmorphia

Jun 06, 2024
money mindset

Never hesitant to rebrand existing phenomena, millennials and their Gen Z counterparts are increasingly admitting to suffering from "money dysmorphia." This term describes a feeling of insecurity and anxiety about one’s financial situation, even when there is little cause for concern. According to a recent Credit Karma study, 43% of Gen Z and 41% of millennials report experiencing this flawed perception of their finances.

What is Money Dysmorphia?

Money dysmorphia is a psychological condition where individuals believe their financial situation is worse than it actually is. This skewed perception can lead to significant anxiety and stress, despite the reality that their financial health may be stable or even robust. Understanding money dysmorphia is crucial for recognising how it affects financial behaviour and overall well-being.

Why Money Dysmorphia Matters
When someone perceives their finances negatively, they might:

Avoid Investing: Fear of losing money may prevent them from making sound investments that could grow their wealth.
Oversave: In an attempt to safeguard against perceived financial instability, they might miss out on experiences and opportunities.
Make Poor Financial Decisions: Anxiety can drive them to make hasty or ill-informed financial choices.

Why Millennials and Gen Z Are Susceptible to Money Dysmorphia

Social Media Pressure: Constant exposure to peers' curated lifestyles can create unrealistic financial comparisons, leading to feelings of inadequacy.
Economic Challenges: Rising living costs, student debt, and housing market pressures contribute to financial insecurity among younger generations.
Lack of Financial Education: Without a strong understanding of personal finance, it’s easy to misjudge one’s financial standing and feel undue stress.

Combating Money Dysmorphia
The first step to combatting money dysmorphia is education. Here at Life Sumo, we believe that improving your financial literacy can provide a clearer picture of your financial health. Here are some steps to consider:

Educate Yourself: Gain a solid understanding of personal finance. This includes budgeting, saving, investing, and managing debt.
Create a Realistic Budget: Track your income and expenses to get a true picture of your financial situation.
Set Financial Goals: Having clear, achievable financial goals can provide direction and reduce anxiety.
Seek Professional Advice: Our financial advisors can offer personalised guidance and help you make informed decisions.

Money dysmorphia is a real issue affecting many young people today. By recognising and addressing it, you can take control of your financial future and make more informed, confident decisions. At Life Sumo, we are committed to helping you navigate your financial journey with confidence and clarity.

Empower yourself with knowledge, set realistic goals, and remember that your financial health is often better than you perceive. Overcoming money dysmorphia is possible with the right tools and mindset.


This provides general educational information only. The content does not take into account your personal objectives, financial situation or needs. You should consider taking financial advice tailored to your personal circumstances. Life Sumo (Orion Enterprises (Cairns) Pty Ltd) has representatives that are authorised to provide personal financial advice.

This article provides general educational information only. The content does not take into account your personal objectives, financial situation, or needs. You should consider taking financial advice tailored to your personal circumstances. Life Sumo (Orion Enterprises (Cairns) Pty Ltd) has representatives that are authorised to provide personal financial advice. If you would like personalised advice - please click here to talk with our team.

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