Patti lives in a renovated farmhouse in a picturesque part of Pennsylvania, earns more than $150,000 a year as a child therapist and has good savings together with a reasonable mortgage.
Yet the 66-year-old describes crippling panic around her finances and getting “crazy flipped” by decisions related to money. “I won’t even buy the more comfortable $15 lawn chairs,” she says.
Patti thinks she may suffer from “money dysmorphia”, a term generally applied to those with warped perceptions of their personal finances who earn well but believe they are poor.
A key symptom is a profound anxiety about wealth that goes beyond the standard concerns such as the cost of living crisis or worries over the threat of a recession. This stress is more distorted, insidious and obsessive.
Google searches for “money dysmorphia” have reached new highs in the past year. One report found that nearly one-third of Americans suffered from money dysmorphia, based on a survey of 1,000 people commissioned by financial company Credit Karma.
The share was even higher among younger people, with 43 per cent of generation Z and 41 per cent of millennials experiencing money dysmorphia. Many of those surveyed had more than $10,000 in savings.
The condition also seems to have made its way to the UK. Those born without wealth but who later acquire it are particularly susceptible. Nearly a quarter of Britons earning more than £100,000 per year continued to identify as “working class” in a 2022 study by polling firm Redfield & Wilton Strategies.
“Money dysmorphia” is not (yet) a clinical psychological term. The American Psychiatric Association does not recognise it as a standalone mental health condition, unlike body dysmorphia, and there are no hard criteria. It is understood as an offshoot of cognitive dissonance — the holding of two conflicting beliefs — or a symptom of broader psychological issues such as anxiety.
Money dysmorphia could be dismissed as a self-diagnosable pseudoscience, but it has found a broad base of early adopters. Indeed, all of us probably know someone whose compulsive money worries could be described as unwarranted and extreme. Perhaps you are one of them.
Growing up may hold the clues to money dysmorphia, according to experts, because your relationship with money is hard wired from an early age.
“Childhood patterns are extremely important,” says US financial therapist Maggie Baker.
“Most parents think if you just teach the facts of money . . . and help them develop a bank account, that’s the way you teach about money. [But] the emotional aspect of money is far more important,” she continues. A child that sees their parents struggling to pay the bills, being unable to fund a school trip or fighting about their finances will retain these as formative experiences, she adds.
Baker has treated multimillionaires who have gone from “rags to riches” but will not pay for comprehensive health insurance because they want to save money. “These patterns are so deeply set that even the most rational argument is not going to move somebody,” she says.
Emerging analysis suggests that money dysmorphia is common among those who have climbed the financial ladder, having grown up much less wealthy.
“[The term] really does resonate with the evidence that we have compiled in the social mobility literature,” says Professor Lee Elliot Major, a scholar of social mobility at Exeter university. Money dysmorphia is something he has witnessed time and again in his years researching class mobility, he says, although he has only recently heard it given a name.
Major, in fact, thinks he might have money dysmorphia. He recalls “panic” after belatedly realising he had to foot a modest bill, or getting “really anxious” about borrowing any money. He laughs, knowing it does not make sense given that he is a middle-class professor and home-owner with a good salary.
“I’ve personally experienced this stuff as someone who was the first in their family to go to university . . . Your origins do stay with you,” he says.
“In my early life, there were times I really had to watch the money. Even though your economic situation changes, your attitude doesn’t. You never quite lose the memory of worrying about how you will find the cash to get through the next week.”
These anxieties can be compounded by the habit people often have of keeping their finances private. As a result, we rarely get external scrutiny of our finances, which means we persist with a mentality of incorrect “money scripts” that never get corrected, says Baker.
“There’s so much taboo about being authentically honest with other people about money that you can get away with these internal narratives,” she says.
It can be even harder to correct our private narratives about wealth when we are drawn by the toxic lure of the online world. Social media has already been blamed for a surge in anxiety among young people, but it has also warped their idea of wealth, says Dasha Kennedy, financial activist and founder of The Broke Black Girl, a network.
This rings true for 23-year-old, London-based freelance journalist Pranjali Hasotkar. “Looking at people my age going on trips, I’m wondering — how did they make a life like this?” she says, noting the incessant flow of online advertising and brags of influencers.
Social media has only aggravated her feeling of money dysmorphia, which she suspects is rooted in the “financial rollercoaster” of her adolescence. She now “hyper-fixates” on her spending patterns, despite earning enough to consider herself financially stable. “Even if I spend a fiver, I would sit and think about it a lot and feel so guilty.”
Most of us think regularly about money. Financial stress is the number one cause of anxiety in the UK, according to mental health charities. But there is a difference between those with a healthy preoccupation about money and those who might be dysmorphic.
Short of an academic diagnosis, Baker uses the following litmus test. First, how much attention do you devote to worrying about money and how much psychological discomfort do you experience? Second, is it proportionate to your financial set-up? Money dysmorphia broadly applies to those who answer “a lot” to the first question and “no” to the second.
“The pathology lies in not doing something about it when you’re self-sabotaging,” Baker adds.
Gillian Hepburn, who works at UK financial advisory group Benchmark, says regardless of how much you make, “healthy” finances include having spare income to save each month, a rainy-day fund and a plan for future earnings or pension. If you have those things in place and you are still deeply anxious — and “losing sleep” — that could be a sign you should speak to a professional.
Getting a financial planner to help with budgeting is a good start. “It sounds counterintuitive, but having a spending plan gives you freedom,” says UK financial wellbeing expert Jason Butler.
That applies whether you are earning the median UK salary (about £35,500), or £96,000 (what the average Brit considers to be categorically “rich”), or whether you are sitting on a comfortable financial bedrock of assets. The difference is that those in wealthier groups can increase their budget (along with guilt-free splurging). This gives us a sense of control when saying “no” to denying ourselves a purchase.
It also means we know exactly what money can be spent frivolously (and avoid panicking when the waiter asks if you would like an extra side dish).
Taking action is important, Baker stresses. At its most benign, money dysmorphia saps joy. It might mean denying yourself a business class upgrade or that £12 sushi roll, even though you can afford it. But it goes deeper. It could also dictate fundamental decisions like whether or not to have children, or inhibit your investments or career risk appetite, or add immense strain to your romantic relationship.
“It has material consequences on your life chances,” says Major. “Whether it is taking out a business loan or making a financial investment . . . it affects our prospects in the workplace as well as with education.”
Meanwhile Patti has been reflecting on her own money dysmorphia.
She recalls being too paralysed to sit down and look at the bills that needed to be paid or to deal with family investments. “I’ve lost money [on the stock market] from being so stuck — I didn’t want to look at it,” she says. But she is also working to fix the problem. “You know what? I’m going to go buy those lawn chairs.”
