We live in a world where comparison has become routine. We open Instagram and see people our age traveling the world, driving luxury cars, buying designer bags, or dining at restaurants that look like movie sets. Meanwhile, we're looking at our phones on the subway, heading to work, wondering if we’re failing at life. This increasingly common feeling has a name: money dysmorphia.
What is money dysmorphia?
Money dysmorphia is a cognitive distortion in how we perceive our financial reality compared to others, especially influenced by social media. It’s a kind of mental illusion that makes us feel like we're financially behind, simply because our lives don’t match the highlight reels we see online.
The term borrows its structure from "body dysmorphia," a disorder in which a person has a distorted perception of their body. In this case, it's not the body but financial status that gets warped. It doesn’t matter how much you earn or how well you manage your finances—if you constantly feel you're not measuring up, you may be experiencing this form of psychological dissonance.
Why does social media fuel this dysmorphia?
Social media is designed to showcase the extraordinary, not the ordinary. People post spectacular moments: idyllic weddings, exotic vacations, luxury shopping—without showing the debt, sacrifice, or stress behind it all.
Algorithms reinforce this by feeding us more of what captures our attention. If you once watched a video of someone flaunting their sports car, you’ll likely see more of the same. It creates a trap: the impression that “everyone” is living like that, when in fact, we’re seeing a carefully curated bubble.
Psychological impact: frustration, anxiety, and impulsive spending
Money dysmorphia can have real consequences on mental health:
- Frustration and low self-esteem: Feeling like a failure because others seem more financially successful.
- Financial anxiety: Increased stress about money, even if your income covers your needs.
- Compulsive spending: Trying to bridge the perceived gap by overspending, just to feel “on par” with others—even if briefly.
A study published in the Journal of Consumer Research (2021) found that frequent exposure to luxury-related content on social media is linked to stronger desires for social status and lower levels of personal satisfaction—even among middle- to high-income individuals.
The problem of appearance vs. reality
The paradox is that many of the people flaunting luxury lifestyles online don’t actually have the money they appear to. Some are in debt, others are sponsored or involved in brand deals that don’t reflect their true financial status. The line between real and fake becomes so thin that viewers can’t tell what’s genuine anymore.
This creates a psychological phenomenon called social dissonance, in which a person feels internal discomfort from the perceived gap between who they are and who they believe they need to be to "fit in."
Signs you may be experiencing money dysmorphia
- You feel like you earn too little, even if your needs are met.
- You avoid talking about money because you feel ashamed of your situation.
- You constantly compare yourself to people you see online.
- You spend more than you can afford just to keep up appearances.
- You feel anxious when you see posts about vacations, luxury, or financial success.
How can we protect ourselves?
1. Limit the time and content you consume
Avoid following accounts that promote unrealistic lifestyles. Instead, prioritize content that values authenticity, financial education, and emotional wellbeing.
2. Remember social media isn’t the full story
What you see is an edited, filtered version. No one posts the extra shifts, the debt, or the rough days.
3. Practice gratitude and perspective
Make a habit of appreciating what you have. Sometimes we overlook essentials like shelter, health, and food—things not everyone has access to.
4. Improve your financial literacy
Learning about budgeting, saving, investing, or financial planning helps you regain control and reject hollow aspirational models.
5. Talk honestly about money
Breaking the taboo and sharing real financial experiences with trusted people helps dismantle myths and reduces isolation.
Testimony: “I felt like a failure at 30”
Marta, 31, shares how she constantly felt frustrated seeing her peers traveling and buying homes while she was still renting. “I compared myself all the time. I thought I was the only one who hadn’t ‘made it.’ Then I talked to a friend, and she confessed she was drowning in debt because of that apartment. I realized I had been comparing my real life to someone else's curated display.”
What if we change the focus?
What if we stopped seeing life as a competition and started living it as a unique experience? There’s no single path to success, nor one definition of happiness. Abundance isn’t always measured in euros, and financial wellness isn’t the same as showing off wealth.
It’s time to build a healthier relationship with money—and with ourselves. Because having a real life, even if it’s not “Instagrammable,” is a luxury too.