5 ways imposter syndrome could be affecting your finances

Written by Leah Sinclair

From spending money to “look the part” to being scared to take risks in your career, imposter syndrome can have a drastic effect on your finances.

Imposter syndrome is something that can affect you at any stage of your life, especially when it comes to your career.

From feeling that you aren’t the best person for the job to worrying if your colleagues feel you deserve your job and accomplishments, this feeling can creep in and leave you questioning whether you’re worthy of what you have.

But it also has the potential to go beyond how you feel about yourself and can even go so far as to affect your finances.

According to a study from Virgin Money, imposter syndrome could be costing us over £5,270 each year (yes, you read that correctly).

“Imposter syndrome is a common mindset whereby we believe ourselves to be less competent than others perceive us to be,” says clinical psychotherapist Dr Jo Gee. “It often results in symptoms of burnout from overworking, feelings of inadequacy and self-critique, a lack of satisfaction at work and a fear of asking for help.”

But how exactly does it affect our finances? Well, Dr Gee and financial expert Alina Jaffer have shared five ways it can negatively impact our finances, starting with the way it puts a blocker on pay raises and promotions.

“Asking for a pay rise is a tricky conversation that many don’t feel comfortable with and imposter syndrome can make this feel even more difficult,” says Jaffer. “Your feelings of inadequacy could be holding you back from having those difficult conversations.”

Another sign imposter syndrome is affecting your finances, according to Jaffer, is if you tend to experience fear of missing out (FOMO) and end up spending more money in social situations to compensate.

“Imposter syndrome can cause us to overcompensate in social settings, making us feel the need to prove ourselves or justify our friendships. Therefore, imposter syndrome sufferers may experience FOMO more regularly,” she says.

According to Jaffer, research reveals that more than a third (37%) of Brits feel jealous when their friends go out without them and the average Brit will spend £353 a year on events they did not want to attend.

“Consequently, your FOMO could be costing you over £300 every year.”

Buying into trends in the hope that you “look the part” is another way your finances could be impacted by imposter syndrome, according to Jaffer.

“Brits spend an average of £1,042 per year on new clothes but wear only approximately 60% of these. This means you could be spending £417 on outfits that you think will help you look the part when in reality they’re going to waste.”

Jaffer says overworking and being a perfectionist due to imposter syndrome could limit your career progression, and thus the amount of money you make.

“Imposter syndrome can result in individuals striving to meet impossible standards. This immense pressure can lead to burnout and consequently, you might end up stagnating your career progression further and potentially missing out on that pay rise.”

Lastly, Jaffer says playing it safe in your career and not taking a leap is one of the biggest factors that impact your finances.

“More than 3 million UK workers are looking to set up their own businesses in 2022 and almost half dream of becoming their own boss. However, imposter syndrome can make taking the plunge feel impossible,” she says. “Research reveals that side hustles can earn individuals an average of £4,500 a year, which you may miss out on should your anxiety hold you back.”

How to deal with your financial imposter syndrome 

Getting past your imposter syndrome takes work – but there are ways to challenge it.

“Imposter syndrome is often linked to money and can lead people to downplay successes, question their salary and even avoid promotions,” says Dr Gee. “If you notice you’re having imposter thoughts around promotions, challenge these thoughts by writing down what a trusted colleague at work might say to you.

And for those who desire to start their own businesses, Dr Gee recommends looking into getting a mentor for support.

“Good mentors are worth their weight in gold when starting up a new business, as their ability to guide can be enough to motivate you past your self-doubt and to a plan for success.”

Image: Getty

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