For Better or for Worse … When Life Changes

www.kimsnider.com Think back on the seminal events in your life. How many would you say were fortunate? How many unfortunate? Financial planners have a term for those changes. We call them transition events. Examples of transition events include marriage, retirement, career change, divorce, loss of a spouse or parent, a windfall or settlement, bankruptcy, the sale of a business and inheritance. Almost all of these events will have both a financial and an emotional component. Some, like marriage, retirement, a windfall or sale of a business are occasion for joy, excitement, optimism and hope. Other times, life’s twists and turns bring sadness, anxiety and fear. If we are honest with ourselves, even the “positive” events often create mixed emotions. My advice … take time to deal with the emotional component before dealing with the financial. I was mentored for awhile by a psychologist who worked with traders at hedge funds. He told me, “Whatever unresolved issues you have in your life will play themselves out in your trading.” At the time, I dismissed his statement as a bunch of psycho-babble. Probably because I had unresolved issues I couldn’t face at the time! Imagine that! But years later, I was able to see that he was absolutely right. And it wasn’t just in my trading, it was how I handled every aspect of my money – from the investments I chose, the house I chose to live in, the car I drove, even the people I chose to hang out with. When we face a transition event …