Keeping up or breaking down? The money dysmorphia challenge

IN Partnership with

Desjardins Insurance’s take on why financial stress runs deeper than the headlines and how better tools can help

FINANCIAL (OR MONEY) dysmorphia is a distorted or unhealthy perception of one’s financial situation. The term describes a psychological state in which people feel financially insecure, even when, on paper, they’re doing just fine. Christina Basedow, a registered clinical counsellor and COO at the Edgewood Health Network, explains: “Focused on finances, and regardless of income, assets, or debt, individuals feel like they’re chronically not enough financially − even when objective measures indicate they’re secure.” That internal dissonance can quietly shape people’s lives, Basedow notes, from the way they spend and save to how they think about their future. For some, she has found, it leads to compulsive behaviours like hoarding or overspending. Others may avoid planning altogether. “It manifests in emotional distress and maladaptive financial decision-making,” Basedow says.

Desjardins Insurance offers a wide range of life and health insurance and savings and investment solutions through our extensive distribution networks. More than five million Canadians are counting on our solid expertise and our people-focused approach at every stage of their lives. Choosing Desjardins Insurance means choosing Desjardins Group, the largest cooperative financial group in North America.

Find out more

“When people understand the basics − how to budget, how to set goals, what their financial picture really looks like − it helps ground them. It takes them out of that reactive, fear-based mindset”

Véronique D’Amours, Desjardins

What is money dysmorphia? While it is not officially recognized as a mental health condition, money dysmorphia remains an informal but increasingly relevant concept. Basedow sees it as a behavioural and emotional reaction to some key features of our times: the rise of curated lifestyles on social media, economic volatility, and a lingering sense of post-pandemic instability. She also sees a generational tilt. “Millennials and Gen Z are especially affected,” she says. “They’re dealing with real cost-of-living pressures, student debt, and [an] unstable housing market, but also with this relentless comparison culture. Many feel like they’re failing, even when they’re not.” That sense of being behind, out of sync, or unable to catch up can override logic. “Someone might have a stable job, savings, and manageable debt, but still feel like they’re drowning,” says Basedow. “That’s where cognitive distortions come in.”

“We’re here to contribute to community well-being, not just individual wealth. By equipping plan members with education, tools, advice, and support, we’re helping to build stronger, more resilient communities − one financial plan at at time”

andrÉe-anne bourgeois, desjardins insurance

Published November 26, 2025

About

Directories

Resources

Investments

Pensions

benefits

News

RSS

Sitemap

Privacy

About us

External contributors

Authors

Terms & Conditions

People

Companies

About

Directories

Resources

Investments

Pensions

Benefits

News

RSS

Sitemap

Privacy

About us

External contributors

Authors

Terms & Conditions

People

Companies

About

Directories

Resources

Investments

Pensions

Benefits

News

RSS

Sitemap

Privacy

About us

External contributors

Authors

Terms & Conditions

People

Companies

A persistent, distorted view of financial security, regardless of actual income, assets, or debt Often manifests as chronic feelings of not having or being “enough” financially Can lead to emotional distress, compulsive spending, hoarding, under-earning, or extreme frugality Shares traits with process addictions, including secrecy and impaired daily functioning

Defining money dysmorphia

Source: Christina Basedow

There’s negativity bias − the tendency to focus on financial threats or losses, even in the presence of safety and stability. Catastrophizing is also common, where individuals leap to worst-case scenarios from minor issues. Confirmation bias reinforces their fears: people ignore signs of progress and seek out evidence that they’re failing. And overgeneralization − the belief that one bad financial move defines your entire money identity − leads to shame, paralysis, and withdrawal. “These distortions reinforce the narrative of scarcity and inadequacy,” Basedow says. “People start to believe they’re bad with money, and that belief shapes their behaviour. It may present as overspending, shutting down, or refusing to plan.”

The ripple effect: from emotional stress to lost productivity The consequences of money dysmorphia don’t end with personal stress; they can affect workplaces, relationships, and long-term financial well-being. Financial anxiety is now among the top drivers of distraction and lost productivity in Canadian workplaces, per FP Canada’s 2024 Financial Stress Index.1 The challenge for financial planners, employers, and individuals is to help restore a more balanced view − one that acknowledges real financial pressures without magnifying them through comparison or misplaced fear. That's something that the team of Andrée-Anne Bourgeois, vice president, group underwriting, actuarial and destination, has encountered in their work with plan sponsors and employer groups. The consequences don’t stop at investment decisions. According to FP Canada’s 2025 Financial Stress Index, there’s a direct link between financial anxiety and workplace productivity.2 Employees spend a significant amount of time2 distracted by money worries,3 as per National Payroll Institute, The 16th Annual National Payroll Institute Survey of Working Canadians 2024. Whether it’s trying to figure out how to “catch up” or just doom-scrolling for the latest economic headlines, it can be a hidden drain on well-being and focus.

how education can help

Financial literacy interrupts cognitive distortions and introduces fact-based tools Helps reduce shame by reframing issues as skills gaps, not moral failings Builds emotional regulation and a sense of control through budgeting, planning, and goal setting Encourages alignment of money decisions with personal values, not external pressure or status symbols

Source: Christina Basedow

Tools and strategies for a healthier money mindset For Basedow, the path forward starts with a two-part solution: emotional insight and financial literacy. “You can’t shame someone into better financial behaviour,” she says. “You help them by educating them, helping them challenge the stories they tell themselves, and giving them tools that build confidence.” That’s where Desjardins Insurance focuses its efforts − on bridging the gap between emotion and action. For Véronique D’Amours, senior financial empowerment support advisor at Desjardins, a possible solution to money dysmorphia is a well-structured financial plan that aligns with personal values. “When people understand the basics − how to budget, how to set goals, what their financial picture really looks like − it helps grounds them,” she says. “It takes them out of that reactive, fear-based mindset and gives them something solid to work from.”

“Financial literacy interrupts cognitive distortions,” says Basedow. “It provides fact-based clarity.” She emphasizes that teaching people these skills can help regulate financial anxiety, reframe struggles as skill gaps rather than personal failings, and restore a sense of control. “It takes the shame out of the equation,” she adds. “You’re not bad with money; you just haven’t been taught how to manage it yet.” Basedow adds that lasting change happens when financial education is aligned with personal values, not social expectations. “When people define financial success based on what matters to them − not what they see online − they’re more mindful, more motivated, and more likely to stick to a plan.” Desjardins Insurance’s financial planners help members set realistic, obtainable goals using the classic SMART approach, ensuring goals are specific, measurable, achievable, relevant, and time-bound. “That’s part of the core approach our planners use,” says Andrée-Anne Bourgeois. Bourgeois and her team at Desjardins Insurance advocate for a mix of practical strategies and modern tools:

create a financial plan: Setting specific, achievable goals grounds your decisions in reality, not emotion. seek advice: Working with professionals if possible − whether that’s a financial planner or an educator − can help you cut through the noise and focus on what matters to you.

Desjardins Insurance has built a suite of resources to make this easier. “Our financial planning service is comprehensive − it looks beyond just saving for retirement to include investment strategies, insurance, estate planning, and more,” Bourgeois says. “For people who want a digital-first approach, our On Target Retirement® tool is an easy way to test different savings scenarios, see the impact of changes, and set more realistic expectations. These tools, Bourgeois says, are designed to help plan members stay focused on their own journey, rather than chasing someone else’s. “It’s about building confidence and autonomy − knowing your goals, making progress, and feeling empowered to make informed decisions.”

Accompanying members to become financially empowered Financial empowerment is not an end in itself but something to strive for. Bourgeois urges employers and plan sponsors to play a more active role, noting, “Employees often aren’t aware of the financial resources available to them. Regular communication, reminders about planning tools, and reviewing engagement data can make a real difference.” She emphasizes that regular reviews with plan sponsors − annual, quarterly, or semi-annual, depending on the need − are another important step. “Plan governance reviews between a sponsor and their insurance provider are a great way for sponsors to become aware of certain stats about their program. Perhaps not that many people are using the website or calling the financial planner. That’s where we can jump in and really bring some added value to their membership.” For Desjardins Insurance, confidence and autonomy are key. The insurer wants its plan members to feel empowered to make good decisions and not be thrown off course by every headline or social media post. Bourgeois credits Desjardins’ cooperative roots for its mission-driven approach, and notes, “We’re here to contribute to community well-being, not just individual wealth. By equipping plan members with education, tools, advice, and support, we’re helping to build stronger, more resilient communities − one financial plan at a time.” For Basedow, the real transformation happens when individuals begin to redefine what financial success means. “We’ve absorbed a distorted image of what it means to be financially ‘well,’ ” she says. “But real stability is personal. It’s about what matters to you, and how your money supports that.” Reframing that narrative isn’t easy − but with the right combination of guidance, insight, and education, it’s possible. And as Basedow puts it, “When you stop chasing someone else’s version of success, you’re free to build your own.” For plan members struggling with financial anxiety, it’s crucial to help them define personal milestones and checkpoints − measurable goals that align with their unique circumstances and values, rather than external benchmarks. This approach not only offers a clearer sense of progress but also ensures that financial planning remains grounded in what truly matters to each individual.

References FP Canada™ 2024 Financial Stress Index, (March 18, 2025) https://www.fpcanada.ca/account/dashboard/fp-canada--2024-financial-stress-index-finds-91-per-cent-of-canadians-are-taking-steps-to-improve-financial-wellness-amidst-stress-increase#:~:text=According%20to%20the%202024%20Financial,who%20do%20not%20(52%25). 2025 Financial Stress Index, March 18, 2025, as cited in:Why your employees’ financial well-being matters - Canada.ca , April 1, 2025, Financial Consumer Agency of Canada. National Payroll Institute, “The 16th Annual National Payroll Institute Survey of Working Canadians: An online survey of 1,500 working Canadians” (2024)https://www.businesswire.com/news/home/20240926539799/en/The-National-Payroll-Institute-Issues-a-Financial-Wellness-Wake-Up-Call-for-Canada Legal Note Desjardins Insurance refers to Desjardins Financial Security Life Assurance Company. Desjardins®, Desjardins Insurance®, all trademarks containing the word Desjardins, as well as related logos are trademarks of the Fédération des caisses Desjardins du Québec, used under licence. On Target Retirement ® is a registered trademark owned by Desjardins Financial Security Life Assurance Company. 200, rue des Commandeurs, Lévis (QC) G6V 6R2 / 1 866 647-5013 desjardins.com

Younger generations, she adds, are particularly vulnerable. Many are navigating lingering anxiety from the COVID era, economic volatility, rising living costs, and the constant digital pressure of curated comparison. “You’ve got millennials and Gen Z dealing with real inflation pressures and a perception that they’re not achieving ‘enough,’ even when their bank accounts tell a different story.”

The ripple effect: from emotional stress to lost productivity The consequences of money dysmorphia don’t end with personal stress; they can affect workplaces, relationships, and long-term financial well-being. Financial anxiety is now among the top drivers of distraction and lost productivity in Canadian workplaces, per FP Canada’s 2024 Financial Stress Index. The challenge for financial planners, employers, and individuals is to help restore a more balanced view − one that acknowledges real financial pressures without magnifying them through comparison or misplaced fear. Financial anxiety of this kind can act like a filter, subtly distorting how individuals make decisions. When a person’s financial self-image is misaligned with reality, they are more likely to respond emotionally rather than rationally. This can result in overextending financially, freezing up when faced with choices, or avoiding long-term planning altogether − behaviours that can undermine both personal well-being and workplace focus over time. But the consequences don’t stop at investment decisions. According to FP Canada’s 2025 Financial Stress Index, there’s a direct link between financial anxiety and workplace productivity.2 Employees spend a significant amount of time2 distracted by money worries,3 as per National Payroll Institute, The 16th Annual National Payroll Institute Survey of Working Canadians 2024. Whether it’s trying to figure out how to “catch up” or just doom-scrolling for the latest economic headlines, it can be a hidden drain on well-being and focus.