Money Dysmorphia and Millennials – A Financial Paradox

Julie Guntrip3/24/2025

A young person has his head placed worriedly in his hands as he reviews his finances on a laptop.

Millennials facing a unique level of financial uncertainty may benefit from personalized money planning. It’s normal to feel some level of anxiety during periods of financial uncertainty, but for Millennials, that feeling is far more common than it is for other generations. In our recent Mind Money Connection survey, we spoke to people about their feelings surrounding money, their conceptions about different generations’ wealth, and their overall concerns about their financial future.53.8% Millennials, as it turns out, think that their generation has a lot of financial anxiety, more than other generations. However, when asked for financial specifics, these same Millennials had some decent news to report: for example, over 52% reported feeling confident about their emergency funds and 45.6% agreed they were on track for retirement.Why does there appear to be a disconnect between their feelings and their account balances?One explanation could be that financial anxiety, combined with changing economic conditions and other social factors, may be leading Millennials to feel a certain degree of money dysmorphia or a skewed understanding and perception of their financial wellness.

Key Takeaways

Money dysmorphia impacts Millennials and younger generations typically more often than older generations.
Financial anxiety and dysmorphia may impact your physical and mental health in the long run.
Finding ways to control your finances and achieve true financial wellness may help reduce feelings of money dysmorphia.

What Is Money Dysmorphia?

Money dysmorphia refers to a distorted view of a person’s financial situation and wellbeing. Put plainly, it causes individuals to feel anxiety about money and may cause them to¹:

Hoard the money they have
Worry about money when they don’t need to
Constantly comparing their finances to others’
Experience intense guilt or shame after making purchases
Look for ways to increase their income more often
Make purchases they can’t afford
Avoid making purchases altogether

According to a report on the topic, approximately 41% of Millennials experience some form of money dysmorphia or a flawed perception of their financial situation.² While some of these behaviors may be reasonable in a healthy situation, money dysmorphia causes individuals to take things to an entirely new level, often bordering on obsession. Money can become an all-consuming concern that makes it difficult for individuals to live their lives in a healthy and productive way.Jenius Bank’s research on the connection between finances and mental health found evidence of this money obsession in Millennials. For example, 57.4% of this age group think about their financial situation daily, and 40% check their bank accounts at least once a day. While staying on top of finances is important, too much focus could be unhealthy.It’s important to note that money dysmorphia isn’t’ something that only Millennials experience. It could impact any generation with any amount of wealth.

What Causes Money Dysmorphia?

Money dysmorphia doesn’t appear out of the blue. There are hundreds of reasons and situations that could lead to feelings of insecurity, and no two individuals will have the same experience. However, it often develops after you experience a financial hardship such as:

Not being able to find a job in an overly saturated job market
Earning less than you expect or feeling you deserve at your current job
Comparing yourself against influencers on social media
Graduating with high levels of student loan debt
Having higher levels of consumer debt like credit cards and personal loans

The disconnect often comes when the individual’s feelings about their money aren’t rooted in the reality of their situation.For example, in our survey, about 58% of Millennial respondents also said their finances were making them stressed, causing them anxiety or feelings of depression (with only 47.5% of non-Millennials saying the same). But almost 30% of the Millennial respondents also said they were on track in life (i.e., “about where I planned to be at this point in my life”). And even more (36.5%) said they were better than where they had planned to be.Perhaps each generation tends to be harder on themselves than other generations. This may lead Millennials to feel that their successes are still not good enough or not keeping up with societal and familial expectations. The “highlight reels” they see on social media could add to the pressure as well.Another explanation could be the financial environment that Millennials experienced in formative “early adulting” years:

A recession in the early 2000’s that impacted them starting their careers
Crippling student loan debt given the push for and cost of higher education
The rising cost of housing that has made homeownership daunting
A pandemic
Most recently, an inflationary economy

One could argue that Millennials have been in a “simmering state” of financial anxiety for much of their adult lives, and even if they have experienced some financial success, the fight-or-flight instincts linger.

The Impacts of Financial Stress

Jenius Bank’s research shows how people’s finances and their mental health are intertwined. This is especially true for Millennials. They were asked on a scale of 1-10 (1 being least affected and 10 being most affected) how financial stress affected their depression, anxiety, or mood in the previous 2 years. In turns out that 52.3% rated it a 7 or higher.As with any type of anxiety, financial stress may cause someone to experience a variety of symptoms, as shown for Millennials:

Loss of sleep – affecting 49.8%
Feelings of guilt or hopelessness – affecting 45.8%
Regular headaches – affecting 35.2% of individuals
Strained relationships with friends and family – affecting 34% of individuals

These experiences may be disruptive and may lead to a diminished quality of life if they’re allowed to continue for too long.

How Millennials Can Overcome Financial Dysmorphia

Though negative and even conflicting feelings surrounding money have the potential to be serious, there are things Millennials could do to overcome those feelings and get their finances and their relationship with money back on the right track. Here are a few tips that may help you to do just that.

Balance Social Media Exposure

Social media presents a double-edged sword. On the one hand, many view it as entertaining and an opportunity to connect with people and ideas that wouldn’t otherwise be possible. When it comes to money, social media may provide education, inspiration, and even feelings of empowerment when exposed to sources of reliable information, positive messages, and varied points of view.On the other hand, there are those that view social media as a source of false narratives about society, and especially about money. The average American spends more than an hour each day scrolling through social media feeds.^[iii] That’s an average of 7 hours a week of exposure to a potentially one-sided, picture-perfect view that “friends” and influencers post online. Frequent and prolonged exposure to these narratives may lead an unsuspecting or vulnerable individual to fall into a comparison trap and experience negative emotions about their own life and financial situation.If you feel social media contributes to these negative emotions in your life, it may be a good idea to set clear boundaries. Consider limiting the number of times you allow yourself to log in to certain platforms or set limits on the amount of time you scroll each day.⁴Social media itself doesn’t have to be the enemy. The key is learning to manage the influence it has on your life as just one input among many. Creating your own path based on your values and goals could help you to filter external messages, including those on social media, through a healthier lens.

Reframe Your Money Mindset

Your money mindset is basically your point of view about money, and ideally it is influenced more by your financial goals and less by your social media feed or advice you receive from peers.Take some time to consider how you truly feel about money and your financial situation. If you’re uncomfortable with where you are currently, that’s fine. But try to analyze what’s making you so uncomfortable. If you’re consistently saving each month, are on track to repay your debts, and are able to splurge every now and then, those feelings of anxiety may not be based in reality.Try to identify what’s triggering your worries and look for ways to reduce your exposure to those triggers or to eliminate them entirely.

Improve Your Financial Literacy

If you’re struggling to keep up with the way economic changes and policies impact your finances, start looking for ways to improve your knowledge. Read financial publications or blogs, listen to podcasts, and consider working with a financial advisor. These simple steps may help you gain a better understanding of your financial situation and opportunities to improve your standing if needed. And if you understand the basics of how economic situations impact your finances, you may feel better equipped to pivot strategies to keep your bottom line looking great.

Build a Personalized Financial Plan

While you may not be able to control economic conditions or the markets, there are some things you could do to gain control over your finances. These actions may give you more confidence and peace of mind. Creating a personalized financial plan is a great place to start. Here’s how⁵:

Track your expenses: Get in the habit of tracking your expenses to see where your earnings are coming from and what you’re spending your income on. Do this for every transaction as you get started so you know exactly how much you’re spending and where that money is going. This gives you the opportunity to see places to cut back if needed and be more intentional about where you do spend your money.
Take Control of Your Debt: Any debt you have could make it harder to escape feelings of financial anxiety. Prioritize paying down what you’ve borrowed using a debt repayment strategy like the debt avalanche or debt snowball method. Once you start paying down your outstanding debts, you’ll potentially free up cash that you were otherwise spending on debt repayment. This could increase your overall disposable income and make it easier to truly feel financially secure, even if your income isn’t going up significantly each year.
Identify your goals: Think about the types of financial goals you have for the short-term and long-term. For example, if you want to take a vacation, you may have a short-term goal of saving a specific amount up before you pack your bags. If you want to pay off your debt, you may want to prioritize paying back what you’ve borrowed over aggressively building your savings. Use these goals to stay motivated and remember to reevaluate your goals as you go.
Set a budget: If you’re not already using a budget to help you reach your financial goals, now could be the perfect time to set one up. Your budget could help you monitor your finances and may make it easier for you to pay off debt or build your savings faster. Check out our guide to help you figure out the right budget system for your needs.

Get Help if Needed

Money dysmorphia could lead to significant stress in your life. If you find that you’re losing sleep, feeling depressed due to situations outside of your control, or just wanting someone to help you find a path forward, consider getting help. Speaking with a therapist may help you overcome feelings of anxiety and working with a financial professional could help you better manage your money and improve your financial wellbeing.

Final Thoughts

Your finances could provide an opportunity for you to live the life of your dreams. But if you’re like the majority of Millennials in our survey, your finances may actually be the source of some sleepless nights.Luckily, there are things you can do to help improve your relationship with money and set yourself up for long-term success. Check out our blog for more tips to help you gain control over your financial situation and develop the confidence you need to make smart money moves year after year.

Financial WellnessLifestyle

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