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Bouncing Back from Financial Grief and Loss

Resilience and financial grief

Awhile back, I spoke at Stanford’s Help Center on the topic of financial grief. I’m not a financial advisor, of course, so I wasn’t able to help with stock tips or interest rates. I was talking about the particular kind of grief that comes along with this type of economy: sudden and unexpected loss of assets and the emotions that follow.

One woman in her early seventies shared that she and her husband were retired but had lost their savings in a Ponzi scheme. Now both she and her husband have returned to work; not something they pictured doing in their “retirement.”

A man in the audience said that he was facing foreclosure on his house. An unexpected loss for him, he said, in Silicon Valley’s “culture of success.”

Is it true that people can actually grieve over lost money, houses, and jobs? Yes, and here’s why: any kind of loss – any kind of loss – can trigger a grief reaction. Think back to when you lost something important to you. Maybe it was a pet, a relationship, a car, or your favorite project at work. Did you experience any of these emotions?

  • Sadness
  • Anger
  • Guilt/self-reproach
  • Anxiety
  • Loneliness
  • Shock
  • Yearning

How about any of these thinking patterns:young woman grieving resized 600

  • Disbelief
  • Confusion
  • Preoccupation or rumination

Or these behaviors:

  • Sleep and/or appetite disturbances
  • Absentmindedness
  • Social withdrawal
  • Crying
  • Restlessness

This is just a partial list of the feelings, thoughts, and behaviors that are a part of the grieving process. If you remember living with some of these when you had a loss, you were likely experiencing grief.

We’re accustomed to thinking of grief as something that occurs only after a loved one dies. The problem with this is that we tend not to acknowledge our feelings as grief when we lose something other than a loved one.

So, can we really grieve over losses brought on us by the economy? Absolutely. But even in these tough times, there are ways to develop resiliency and not only bounce back, but thrive.

Complications of financial grief

Financial loss is not only about money. It probably wouldn’t be so devastating if it were. Here are just some of the other losses that come along with a sudden drop in assets:

  • Plans for retirement: Those ideas you had about retiring in a few years may have gone by the wayside now due to your 401K and IRAs losing money, having to dip into your savings sooner than you thought to keep the house, your business earning much less than in the years before the recession, unemployment, or losing your house.
  • College savings: You thought your kids would be able to go to a four-year university and now you’re hoping you can support them through community college. This wasn’t the dream you held for them all these years.
  • Housing: That loan that seemed so great a few years ago now has you upside down and struggling to pay your mortgage. Or maybe you’ve already had to sell your house or – the last thing you expected – you were foreclosed on.
  • Lifestyle: Your lifestyle may have taken a big hit in the last couple of years. Eating out, vacations, recreation time and activities, buying gifts for others . . . many of the things you took for granted have now changed.
  • Life Script: When very young, you started to write a Life Script for yourself. “I’m going to be a doctor,” “I’m going to be a scientist,” “I’m going to work with animals.” As you grew, you expanded your script, “I’m going to go to college, have a good job, get married, and live a healthy, happy life.” Most likely, your Life Script did not include, “I’m going to lose all my savings when I’m 60” or “I’m going to trust someone to make me a lot of money just to have them steal it all so I can go back to work when I’m 70” or “I’m going to buy the house of my dreams and then be foreclosed on four years later.”

The abrupt alteration of your Life Script, changes in your lifestyle and housing, and shattering of dreams for yourself and your family all magnify the emotions that surround financial loss.

Still, since we can see that all of this adds up to a BIG LOSS, why is it so hard to express grief about finances? What is it about this type of grief that is different than the emotions we feel when we lose someone we love? Well, there are some complications:

  • Embarrassment: It’s one thing to tell someone that your mother died, but a completely different thing to share that you lost your money in a Ponzi scheme (adjustable-rate mortgage, Lehman Brothers collapse, job loss, or any other issue related to recession.) We don’t usually chat with our neighbors and peripheral friends about issues related to money; it’s just not one of our cultural norms.
  • Loss of identity: You used to be Software Engineer Who Owns A House And Has Enough In the Bank To Put My Kids Through College and now you are Unemployed Dad Who Lost My House Due To Foreclosure And Had To Move The Family In With My Folks. Maybe your situation isn’t that drastic, but you get the idea. You identify with your work and your social status, among other things, and so you might be unsure of who you are right now.
  • Feelings of betrayal: Dealing with a loss is difficult enough without the added emotional fallout from feeling betrayed by banks, mortgage lenders, the government, Bernie Madoff, and Wall Street in general. Now you are not only dealing with grief, but anger and resentment as well. In addition, the anger and resentment may be at a spouse, friend, or relative who gave you bad financial advice.
  • Denying the magnitude of the loss: It is very easy to think, “I shouldn’t be feeling this bad. It’s not like someone has died.” You devalue your own feelings because it’s “not as bad” as something else.
  • The thought that financial crisis = personal failure: “If I was a better money manager, this wouldn’t have happened. I’m such a jerk.” “Why did I listen to that broker? I knew better. This is all my fault.” “I must be a real loser to have thought I could refinance my house with an adjustable rate mortgage.” This mythological thinking is very easy to fall into, but certainly not helpful (or true.)
  • Lack of social ritual for this kind of grief: We have many rituals for the death of a person: funerals, memorials, sitting shiva, wakes, etc. These customs help us with closure and adjusting to the world without our loved one. But there are no rituals around the loss of finances and the dreams that went with them. We are left feeling unfinished and lost.

So, it really is pretty complicated, isn’t it?

Learning to survive and thrive after an economic setback.

Surviving . . .

1. Acceptance

  • Accept the fact that this loss has really happened to you. Denial is a strong and protective mechanism. It helps to numb you against pain until you’re ready to deal with it. Sometimes you need to consciously make the move out of denial, though, and work toward acceptance. If you find yourself thinking, “Once the stock market comes back, everything will be fine” or “Even though this new job pays half of what I made before, we can still live the same way we did before,” you are still in denial. It’s time to intentionally assess your situation and accept its reality.
  • Honor your own grief about what you have lost. This really is a loss – be careful not to minimize it.
  • Don’t resist. This does not mean to give up. But it does mean to acknowledge both your emotions and the fact that you have experienced economic and financial loss rather than fight against them. Going with the river current is much easier than fighting to swim against the current.

2. Build and use your support system

  • Find people you trust: friends, family, spiritual leaders. Gather your support team around you just as you would if you had lost a loved one.
  • Talk. You don’t have to talk about the specifics of the loss, just your feelings about it. This is an important way for you to process your grief and not get stuck in it.Don’t worry about the stock market.
  • Take your power back. By talking about your feelings related to the financial loss, you take the power away from the “deep, dark secret” and shine the light of day on it.

3. Get a different perspective

  • Put the brakes on rumination. It’s easy to get stuck re-hashing the problem over and over again, trying to “fix it.” But then your focus gets very narrow and The Problem becomes the only thing in your life. Let go of it. Widen your focus and see what else is in your life.
  • Remember that you have made it through past challenges. When you’re faced with a loss, it can seem like the worst thing that has ever happened to you. And it might be. But remember that you have experienced many difficulties in your life and you have made your way through them. You have to work on it; it doesn’t happen magically. But take heart in the fact that you have overcome challenges before.
  • Stay in the moment. This is hard to do but a real relief when you can. Rather than ruminating about past events or fretting about the future, try to stay with what is happening right now. Come up with your own perspective-changer that reminds you to stay in the moment. The perspective-changer I use is my memory of sitting with a dying client who was at peace with her own death. Being with her made everything else seem like small stuff.

And thriving . . .

4. See what you can learn.

  • There’s a lesson in everything. Maybe you did make some poor financial decisions. Learn from your mistakes. Maybe your value system was overly focused on material things. Learn the joys of simpler living. Maybe your kids didn’t really understand what it meant to pull together as a family until now. Help them learn this lesson during these tough times.

5. Find the gifts.

  • The sand that irritates the oyster eventually makes a pearl. The economic loss you are experiencing now may be the very thing you need to learn to thrive into new opportunities opening before you. I heard something surprising on NPR’s Talk of the Nation the other day. The show was about a man who used to be a restaurant critic but, because of the economy, lost his job and is now learning how to survive on $200 Jobless not hopeless resized 600per month of food stamps. Not only had he learned to do it, but another young woman called in and said her time on food stamps was the greatest gift she’d ever received! She had learned to cook, to save money, to eat nutritiously on a budget – none of which she thought she’d ever do.
  • There are gifts to be found everywhere, even in the darkest of times. When my partner’s breast cancer was discovered, it was already at Stage IV. We could not think of a more terrible thing to happen. But, after using some of the “surviving” tools above, we began to see the gifts pouring in. We learned that we were much stronger than we thought, we learned how many caring friends we had, my partner – who had always struggled with her self-image – found out how many people truly loved her, and we found peace through renewed spirituality.

Getting your bounce back after financial loss may not mean getting your money or assets replaced, but it does mean learning to survive – and thrive – in the most difficult times.

Will you take this as an opportunity or a defeat?

Bobbi Emel is a therapist who helps people in Los Altos, Palo Alto, Mountain View and the greater Bay Area manage their stress and develop their strengths.
She is effective in helping people dealing with anxiety, worry and grief; and also those who want to improve their effectiveness and performance.