Finding yourself at the age of 50, 60 or 70 without a retirement fund, is not a happy discovery. Whatever the reason, there will be feelings of despair.
The first thing to do is realize that this is a loss like any other, and may follow a typical psychological pattern after loss:
- depression and
Each phase can last a few days or years, depending on your psychological makeup.
Denial is ‘an unconscious defense mechanism characterized by refusal to acknowledge painful realities, thoughts, or feelings’. If your financial plight is due to your own stupidity or you are embarrassed at being duped, then you may not want to confront the reality. This can lead to isolating yourself because dealing with it in the company of others, may be too painful. As you bottle it up, this can increase your anxiety.
When Nick Leeson of Barings Bank covered up huge bad risks in 1995 his first inclination was to flee – running from one country to another. He eventually faced the music, realizing that part of recovery involves naming the obvious and acknowledging the feelings that accompany it. (He now advises banks on how to avoid making the same mistakes which allowed him to defraud them in the first place.)
Anger at others and yourself may follow. You may go too far in confronting the perpetrator or hit out at friends or relatives, or like the ‘Occupy Wall Street’ protestors, find some peaceful way of registering your outrage. If your troubles are down to you, don’t kick the dog! Recognise it for what it is: anger. As an adult you will probably be quicker to find productive ways of using that energy!
Bargaining with the bank or the people in power may happen in the early stages and in some cases may avoid some of the worst consequences but taking responsibility and creating a new plan is the only way.
Depression is loss of hope. When you find yourself without a secure future and even loss of identity, as well as the prospect of having to once more, to put a shoulder to the wheel, depression may set in.
We highly recommend Bobbi Emil’s blog. Its lessons about cultivating resiliency derive from her own experience of losing everything during the financial recession in 2009.
It can take some time before you see the way through the maze of confusion and unhappiness, but the next step, namely acceptance, means that you have come to the place you have to be, to move on.
Finally accepting the reality and picking yourself up, dusting yourself off and starting all over again is the task at hand.
What lies beyond ‘acceptance’ is work! But obviously work with an urgency to build financial freedom all over again.