A recent study conducted by Qualtrics on behalf of Credit Karma, surveying 1,006 US adults between December 18 and 26, 2023, reveals that a significant portion of younger Americans, particularly those from Gen Z and millennials, struggle with "money dysmorphia." This condition affects 43% of Gen Z and 41% of millennials, leading to a distorted perception of their financial reality and fostering feelings of inadequacy when comparing their finances to others. Despite 59% of all respondents claiming financial stability, a substantial number of younger adults feel financially insecure, with 82% feeling behind their peers financially.
The report suggests that social media plays a substantial role in fueling this dissatisfaction with one's financial situation, as nearly a quarter of Americans report feeling less satisfied with their financial circumstances due to online comparisons. Events like the 2008 financial crisis and the 2020 pandemic have also been highlighted as impacting financial perceptions.
Courtney Alev from Credit Karma suggests practical steps to combat money dysmorphia, including taking a realistic look at one's finances, setting clear financial goals, and minimizing social media consumption to reduce the pressure of comparison. These measures aim to help individuals focus more on personal financial growth and less on how they stack up against others.