Money dysmorphia is an internet term that describes a very real feeling of a rocky, warped relationship with your finances.
If it seems like no matter how much money you make, you feel financially insecure, or no matter how stretched you are, you still spend impulsively, you may be experiencing money dysmorphia.
René Basson, head of brand at Satrix, says social media exacerbates feelings of inadequacy, making many people wonder why they cannot keep up with their peers.
She says money dysmorphia ‘shows up’ in two ways. “A social media scroll can make you feel as if ‘everyone’ is holidaying in exotic destinations, making you wonder why you are falling behind when in reality, you are fine financially. Or perhaps you are deep in debt but you keep chasing dopamine hits from retail therapy that stretch your finances further.”
A survey by Credit Karma found that 43% of Gen Z and 41% of millennials have experienced some form of money dysmorphia. Basson says these generations, known for their addiction to digital savviness, seem particularly prone to financial insecurities.
This can lead to irrational decision-making, which affects future outcomes. The antidote? Having a solid plan in place and pursuing empowering patterns of behaviour like investing, Basson says.
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Money dysmorphia can strike at any time
“Anyone, in any stage of their financial journey, can feel dysmorphia. In South Africa, where inequality is acute, many people grow up in homes with a tight budget. This feeling of financial precarity may continue to restrict enjoyment of money, no matter how financially successful an individual is. This is often termed the ‘phantom limb of poverty’ or ‘post-brokenness stress disorder’.”
Conversely, Basson says, perhaps you have growing debts, but you just cannot stop spending. “It does not help to keep scrolling and seeing what we perceive as others living their best, most luxurious lives. Add to this the thousands of clickbait articles on people who ‘made millions by 30’ or ‘retired by 25’ and it is no wonder people feel pressing anxiety and less confident in their choices when it comes to money.”
She says it is also worth noting that harmful stereotypes hurt too. “From early on women often internalise ideas like ‘women are bad at money management and tend to overspend’, or ‘women don’t invest or take risks’.
“This happens although Fidelity Studies, for example, found that women tend to be better savers and investors than men. No wonder women can feel acute dysmorphia when it is ingrained through the language society uses.”
Some stress around money is completely normal, especially given the current climate of high inflation and interest rate cycles. However, Basson says that if you find yourself in patterns of thinking that harm your financial wellness and confidence, it is time to make a change.
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How to deal with money dysmorphia
You can shift your money dysmorphia by asking:
- What is your real situation? Start by assessing your real financial picture. You could need a financial adviser to help you see your situation holistically. Once you know the nitty-gritty, you can come up with a realistic financial roadmap.
- What are your goals? Goal-based investing is a powerful mechanism to incentivise action. Think about what you want to achieve in the next few years. Set up investments to save towards these goals, taking their timeframes into account. This will help you claim back control.
- What is your pattern? Do you find you are always worrying about your finances and future? Or do you keep impulse spending when you are stressed about money? Gently note your patterns and consider working with a coach or counsellor to start integrating cognitive strategies to promote healthier, more productive cycles of thought and behaviour.
- Do you have a values-based money mindset? Think about what is really important to you. Are your values aligned with your spending, saving and investing behaviours? Introspection around what matters to you can be a powerful incentive to switch to healthier habits.
- Do you have a team? Think about what your pain-points are and get the right professionals in place to help you move forwards. Dealing with debt? Consider a credit coach. Need a plan? Talk to a trusted intermediary.
- Should you keep Investing? Benefitting from compounding investing returns is hugely empowering. If you can keep contributing to a diverse investment portfolio and watch this grow, it is very vindicating and it can help build confidence in your financial future. Just start the journey, whether you have a lot or a little.
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You deserve a fulfilled financial life
“You deserve to live your best and most fulfilled financial life now and in the future. That means feeling in control and empowered to make the right decisions to move towards your goals. Starting your investment journey can help put you mentally back on track and in the driver’s seat of your finances and your life.
“It is brave to seek help if you need it. Get the right people on your side to prioritise your mental and financial wellness.”
