In discussions about mental health, there's a topic that often gets overlooked: money dysmorphia. This term describes the disquieting feeling of believing you don’t have enough money, even when your bank balance suggests otherwise. This disconnect can greatly affect your mental wellbeing and may lead to unhealthy spending habits and work habits.
You might be enjoying retirement or be in a steady job with savings, perhaps even reassured by your TCFP financial planner, yet that doubt persists and can leave you feeling anxious and overwhelmed.
Interestingly, searches for "money dysmorphia" have surged by 136% recently, indicating that many people are wrestling with this concern.
What’s Happening?
Have you ever felt guilty about your earnings or too anxious to check your bank balance? It’s a more common experience than you might think - one that can trigger panic when unexpected expenses arise.
Consider the case of Emma Hull. Despite having a stable job and a decent cushion of savings, the thought of using some of her savings for a much-needed holiday filled her with anxiety.
To help Emma navigate these feelings, we suggested creating different savings pots within her banking app. This simple adjustment gave her a sense of control, alleviating her worries and enabling her to view her finances more clearly.
And it’s not just everyday individuals who feel this way. Even clients with substantial wealth, like one of Ollie Saiman's, experience stress over money management. Understanding the roots of these feelings is vital. Financial anxiety can originate from a variety of sources, including our upbringing and past experiences.
What Underlies Financial Anxiety?
At the heart of money dysmorphia lies cognitive distortion - a mental pattern in which we perceive reality in a twisted manner. For instance, our anxiety often exaggerates our financial concerns, perceiving threats where none exist. This can escalate feelings of fear and anxiety related to money.
Several factors contribute to these distorted perceptions:
- Real or Perceived Cost of Living Crisis: Many individuals feel compelled to panic-save due to economic uncertainty, even if their financial situation is stable. Scare tactics can create a sense of danger when, in reality, you might be just fine.
- Childhood Experiences: Growing up in a financially struggling household can shape your adult attitudes towards money, often casting them in a negatively skewed light.
- Past Traumas: Distressing experiences like bankruptcy or financial fraud can result in long-lasting anxiety that influences current spending behaviours.
Simple Steps to Cultivate Peace of Mind
- Track Your Spending: Awareness is paramount. Understanding where your money goes can help realign your perceptions. You may find that you have more financial freedom than you realise. It can be easier to do this with a trusted person if you’re feeling overwhelmed.
- Avoid Comparisons: Social media can distort your view of success. Focus on your own financial journey rather than measuring yourself against others.
- Set Savings Goals: Establishing specific targets can instil a sense of achievement and control, helping to alleviate financial anxiety.
If any of this resonates with you, remember that you are not alone. Money dysmorphia affects a surprising number of individuals, but there are tangible steps you can take to manage it. By blending an understanding of the psychological aspects with practical strategies, you can foster a healthier relationship with your money and ease that financial anxiety.