What is money dysmorphia—and how do you overcome it?

As the youngest generations build their financial futures, scrolling through social media can trigger a sense of failure. For Millennials and Gen Zers, it’s a #RichTok world, flooded with influencers who flaunt their shopping hauls, luxury kitchen reveals, and high-end vacations. And stacking these far-fetched curated reels atop today’s wider economic uncertainty could contribute to a distorted perception of wealth leading to financial anxiety.

When the 2025 Schwab Modern Wealth Survey asked Americans how much net worth they’d need to feel wealthy, Millennials answered just over $2 million while Gen Zers said $1.7 million. Yet nearly 57% of Gen Zers and roughly 58% of Millennials said they were not on track to achieve such ambitious goals or didn’t think they would be wealthy in their lifetimes. 

These outsized expectations are part of a growing phenomenon for Gen Zers and Millennials dubbed “money dysmorphia”—feeling like they don’t have enough money, even when they do. 

It doesn’t matter that, according to the Federal Reserve, they’re making more than previous generations. Or that the net worth of Millennials has quadrupled over the past five years. Or that they stand to inherit a whole lot. Dogged by so-called “phantom wealth”—those illiquid assets they can’t see in a bank account that don’t seem real to them—many still suffer from the financial stress of feeling like they’re falling behind. According to a study by Qualtrics on behalf of Intuit Credit Karma, 43% of Gen Zers and 41% of Millennials say they struggle with money dysmorphia. Of those, a staggering 95% admit it’s hurting their finances.

“Money dysmorphia happens when how we feel about money doesn’t match our actual financial reality,” says Kumiko Love, Accredited Financial Counselor (AFC) and author of My Money My Way: Taking Back Control of Your Financial Life. “You can be financially stable and still feel broke every day. You can also be overspending even when you believe you’re doing well.”

Money dysmorphia can wreak havoc not only on your peace of mind, but on your financial planning. For some, feeling behind can lead to overspending—figuring they’re too far gone for splurges to really matter. 

But that’s a mistake. 

For others, money dysmorphia manifests as a constant fear that the rug could be pulled out from under them at any moment. It could be a mindset shaped by economic events or experiences they faced as children or young adults: watching their parents suffer through the housing crash or overcoming their own crushing debt from student loans. Sometimes it even manifests as stress saving—or compulsively holding onto money as an emergency fund out of sheer panic.

Our relationship with money begins long before we make our first dollar. It forms through what we saw and heard growing up,” Kumiko says. “If someone watched their parents argue about bills, they might associate money with fear or conflict in adulthood. If they grew up hearing comments like ‘We can’t afford that,’ they may struggle to feel financially secure even when they have enough.” 

Ready for a financial reality check? Here’s what Kumiko recommends to help ease your money worries and get back on track to emotional well-being:

1. Take stock of your personal finances.

Intentionally tracking your saving and spending habits will let you get a handle on what’s coming in and going out. Step one? Create a budget. It’s a simple but powerful way to reveal the truth about your finances and ensure your mindset is grounded in reality.

“Tracking spending, understanding your inflow, and knowing your true numbers brings grounding,” Kumiko says. “You don’t need a perfect budget or plan on day one. You just need a plan that feels doable.” 

2. Set goals based on your values—not comparisons.
Before you splurge or save, ask yourself why you’re doing it and whether those decisions align with your financial goals, rather than someone else’s expectations. Limiting your exposure to money dysmorphia stressors like TikTok can’t hurt either.

“I always tell people that awareness is the first win,” Kumiko says. “The key is to remember your own values. When you know what you’re working toward and why it matters to you, comparison loses its power.”

3. Dig into your relationship with money.
Examining how you interact with money and understanding what it means to you can improve financial habits and reduce feelings of inadequacy. Start by taking a closer look at how your money mindset was shaped and whether those beliefs still apply to your current situation. 

“Early memories create beliefs, and those beliefs quietly influence how we spend, save, and react to money until we take the time to unlearn and rewrite them,” Kumiko says. 

4. Talk it out.
If you’re truly stuck in a money dysmorphia loop, it might be time to seek support. Meeting with a family member, a financial advisor, or a mental health professional can help you identify and change bad habits—and gain a more realistic perspective on your finances.

“Without clarity, feelings take over. But when you see what is really happening, you can make decisions based on your goals—not anxiety or avoidance,” Kumiko says. “Clarity builds trust in yourself, and that trust is powerful.” 

There’s no need to be embarrassed if you have money dysmorphia. Just keep the focus on overcoming it—and improving your financial well-being.