Ep 50 | The Financial Dysmorphia No One Talks About
This episode dives into a self-sabbotaging psychology and uncovers why people making $150K… $300K… even $900K still feel broke, stressed, and behind.
Priya shares two real stories of six-figure earners stuck in the same self-defeating loop for totally different reasons, and breaks down the emotional patterns that keep HENRYs [High Earners, Not Rich Yet] in survival mode no matter how much they make. If you’ve ever said “I should be further along by now,” this one’s for you.
Takeaways:
Why your income level stops mattering once your habits and psychology take over.
The sneaky loop nearly all six-figure earners fall into and how it quietly destroys long-term wealth.
How one entrepreneur earned $1.4M and still ended up with credit card debt and no savings (and why it’s more common than you think).
Why windfalls make smart people act irrationally (yes, even you).
The real reason two people can spend 10–20 years together and still make zero financial progress.
Follow Priya Malani:
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Transcription
Hey guys. Welcome back to the show. Today marks my 50th episode. That means dozens of conversations at your fingertips designed to help you maximize your money in your thirties Along the way, I've had some incredible guests. Authors, financial advisors, therapists, micro celebrities, all sharing their stories to prove one thing. Personal finance isn't hard, it's just emotional.
And that's exactly what I wanna talk to you about today because when it comes to money, your success might have nothing to do with how much money you're actually bringing in. You might be making six figures, and still be your own worst enemy without even realizing it. Alright, let's get into it.
So I think we all have this idea that really, really rich people can do whatever they want. They can buy whatever they want, go wherever they want, say yes to whatever they want at, pretty much at any level that they actually want. No matter how many people I talk to, whether they make $150,000 a year or $900,000 a year, everyone says the same thing. I feel crunched. Everyone, all ages, all industries, all income levels, and if everyone feels crunched, then it has nothing to do with the amount of money that you make. According to a study in Time Magazine, 51% of people making over a hundred thousand dollars per year live paycheck to paycheck.
And 64% of six figure earners say that their income feels like survival mode, not wealth. That's pretty wild. Financial therapists now have a term for this money dysmorphia. It's the distorted belief that you have less, are behind, or are failing even when your income says otherwise. So, if everyone feels crunched, even high earners, it's not the money, it's the habits, it's the psychology, it's the core wound you're trying to use money to soothe- whether it's deprivation, scarcity, identity, or validation. Bad habits do not go away when you make more money, they just amplify. And today I'm gonna tell you two stories from people who are very close to me, both in their early forties, both earning six figures for more than a decade now, and both stuck in the exact same cycle for totally different reasons.
One is a friend of mine, an entrepreneur who's pulled in about $1.4 million in the last 10 years, and yet she's sitting on $20,000, a little bit more of credit card debt with no retirement savings. The other has two jobs, earns solid money. And genuinely believes he's poor. Simultaneously, he owns nearly by his count 1000 pairs of Nike shoes.
Alright, let's get into it. So this first friend, I've known her for about 15 years. She's in her early forties now. She's absolutely brilliant, charismatic, wildly talented. She gets amazing speaking gigs, hosting jobs, creative projects with big, big brands. And she gets paid. But she's also a classic case study of something I need every entrepreneur, freelancer, and commission-based earner to hear. You cannot build financial stability on top of an unpredictable income stream unless you intentionally engineer stability for yourself. Over the last 10 years, she's brought in about $1.4 million. On average, that's about $175,000 per year, and yet she has $20,000 in credit card debt and no retirement savings other than what's been gifted to her, which is another story for another day. No financial buffer, no system she can stick to, and just a constant undertone of panic around her money. So let's look at a couple reasons why. First problem is that her income is inconsistent.
She's never been paid on a rhythm that she could rely on. So she'll get a windfall and then she'll go months with nothing. That's the first thing. Second. And I see it time and time again. Inconsistent income creates a scarcity mindset. Scarcity leads to hoarding. Hoarding leads to guilt. Guilt leads to deprivation, which leads to overspending, and then comes the shame. Rinse and repeat. It's a constant loop. Next up. Windfalls distort reality. Most people treat windfall money differently than their earned money, and I see it with people who earn large sales bonuses.
Big quarterly commission checks, even a tax refund. This is classic mental accounting and behavioral economists will tell you that humans categorize dollars emotionally, not logically. For whatever reason, a dollar from a windfall feels way different than a dollar from your paycheck. And because it feels different, we spend it differently.
With my friend, every big payout, 60 grand, 75 grand, a hundred thousand dollars temporarily changed her sense of what she could afford. It inflated what normal spending looked like or felt like to her. And for a moment she felt rich. I'll tell you this. Feeling rich and being financially stable are two very different things. Next up, her, her upbringing worked against her here. Immigrant family, parents came from nothing, built everything, expected excellence. That pressure plus the inconsistent income, created the perfect storm for her money dysmorphia.
Finally, and this is the big one, she thought her income was the problem, but it wasn't. It was her habits. Lack of structure, lack of systems, lack of stability, lack of honest money conversations. Her income was not the issue. She was technically a millionaire and how much she had earned, it was her psychology that was the problem.
Next up, this is someone I've known for almost 15 years. He's the kindest soul in the world, huge heart, and he's stuck in an unbelievably painful financial loop. He earns great money consistently. He has two jobs, but a solid salary, strong bonus tax refund, all the things, and every single time he gets one of his wins, he says the same thing to me. Everything's gonna change in January. Everything's gonna change when the bonus hits. Everything's gonna change after the refund fund, and every single time nothing changes because the money isn't the problem. His habits and his mindset are, and here's the pattern. He gets the bonus. He buys a few more pairs of Nikes. He keeps eroding his financial foundation, his financial potential through his daily spending. He ends up in the exact same spot he started, except now thanks to Affirm and Klarna and all those buy now pay later systems.
He's in $30,000 of high interest credit card debt. He owns regular payments to these buy now, pay later platforms. But yeah, he owns nearly a thousand pairs of Nike shoes.
For those of you who are wondering, I have said this to his face. He derives his identity, his validation, his belonging from a shoe collection that he cannot afford. The shoes won't fix the wound. They decorate it. here's where the psychology becomes unavoidable. When you don't feel like enough, you will always spend money trying to fill the gap. It's not about the shoes, not about the fast food, it's not about the excuses. It's about the core wound. His addiction patterns have shifted alcohol, shopping, eating, escape. Money is simply the the medium that allows him to access these habits.
And when you combine this with lifestyle creep, it becomes the worst trap in the world. As income rises, expenses rise, validation, purchasing rises. But long-term wealth does not. One more note on this human, who I love dearly, my bonus chaser friend is also in a long-term relationship, but they've never merged their finances, never looked at their goals together, never had transparency.
This is exactly how two people can go 10 to 20 years without moving closer to financial freedom. I take a strong stance on this. Couples who work as a financial team will accelerate wealth. Couples who don't, won't. It's actually not about combining money. It's about combining your vision.
So what's the lesson here and why is this so important in your thirties? We have two opposite people, two opposite money stories, and yet the exact same problem. They've waited for more money to fix a psychological problem, but money only amplifies what's already there. If you don't fix your relationship with your money in your thirties, you will absolutely be playing catch up in your forties.
You simply cannot earn your way out of your bad money habits. You cannot bonus your way out of your money dysmorphia. You cannot windfall your way out of scarcity. For most of us who don't and will never live on Billionaire's Row, there is no income high enough to compensate for inconsistent habits, unclear systems, or unaddressed wounds.
But I promise when you fix the habits underneath your income, when you deal with the psychology, the wound, the patterns. You create a life where money finally stops being the problem, and that's the goal, right? Like nothing you've ever heard me say is that I want you to be thinking about money more. It's not about thinking about money more. In fact, it's about thinking about money less automating it. That's the name of the game. But you have to start by fixing your psychology. You also have to stop making excuses.
Okay, so that was heavy. Before I let you go, we're gonna do my favorite segment, Best Bite. Every week, I share the best thing I've eaten recently. Where you need to go, what you need to order. I'm a big foodie and I live in New York City, so it's very lucky. This week I went to a place on 17th Street in Chelsea. It's called La Dong. It's a fancy French Vietnamese restaurant, and they had a Wagyu Pho that was so freaking good. I've been dreaming about it ever since. So that's my recommendation if you live close by or you might be visiting New York City for the holidays. It's an absolute can't miss, and you definitely need a reservation.
All right. That's it for today. If this episode made you rethink your relationship with money or your habits, or the stories you tell yourself about what you deserve, amazing. I hope you share it with someone you care about who maybe doesn't think that their six figure income is high enough. And remember, financial freedom isn't for people who care more about money. It's for people who are tired of money being the thing that drains them or stresses them out or holds them back. The more we talk about this stuff, the less power it's gonna have over us.
And shameless plug, if you're not subscribed yet, please go hit that button. It means the world to me and helps us reach more people. Alright, see you next time.
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