I think this an interesting article and video from a Swiss Psychologist thinks about the “5 Stages of Grief Investing.” Basically she applies typical psychoanalysis to what people are going through as they suffer through today’s economy. What are the five stages?
First up – Denial. It’s where you refuse to believe that acknowledge the economy is in the toilet. Throwing away your 401k statement without looking at it. I believe this is where I fall. I’ve given up really looking except once a month when I do my net worth accounting. I’m not going to change my strategy so I might as well not bother.
Second – Anger. It’s where you blame everyone else and wonder why? I can honestly say I know tons of people who are super PISSED. They can’t help but be bitter over the fact they’ve lost a ton in the market. They sit there going why bother saving when it just all went away?
Third – Bargaining. It’s asking for a good day on the market so you can sell what you have and get out. I haven’t heard too much of this. Most people have given up hope for a good day.
Fourth – Depression. This I’ve found has gone hand in hand with Anger. The same people who are angry alternate between angry and depression.
Final stage – Acceptance. The idea that it’s bad but it won’t last forever. That you can look forward to tomorrow.
Personally it’s probably why I don’t look at my stocks everyday. I’d be depressed or angry. I just keep investing money and working. I have to work to eat, and my life is pretty awesome honestly other than my investments. I’m happy, healthy, and living a nice life. I have a lot to be grateful for. So I guess I’m half in denial, since I won’t look at my investments, and I’m half in acceptance. Accepting I can’t change anything and accepting of how good I’ve gotten it.
Where do you stand?
8 responses so far ↓
1 Kristy // Mar 10, 2009 at 11:12 am
I think I fall in the acceptance category. I am still plugging away at our investments and still hopeful that it will get better soon. I don’t think I was ever in the middle three phases, just denial and acceptance.
2 JoeP // Mar 10, 2009 at 2:25 pm
I was angry that we were losing money on paper, but didn’t change my strategy one bit. Buying low is a good idea since we’re retiring 15-20 years from now.
3 Pol* // Mar 10, 2009 at 3:47 pm
I fluctuate daily, honestly.
I admit I fluctuate between acceptance and depression mostly…. though anger hung on for a while.
Like JoelP, I am hanging on to my strategy and “buying low”. I have a good long time to retirement and no need to withdraw before then… I am TRYING to have faith in the long term overall success of the system. Fingers crossed.
4 LAL // Mar 10, 2009 at 9:12 pm
I’m definitely moving more and more to denial. I hate looking and I try to avoid my stocks. I wouldn’t get angry just sad.
And nope my strategy didn’t change at all.
5 Trevor @ Financial Nut // Mar 10, 2009 at 10:41 pm
I feel in a lot of ways that I am at the acceptance level, largely because I’m young and I have time to let this all work out.
It still sucks.
6 Kristy @ Master Your Card // Mar 11, 2009 at 1:30 am
I think I fall in the acceptance phase. I don’t think I hit any other phase. I’ve been fully aware of the amount of money I lost from the get go, and while it sucks, I made the decision to let it affect my outlook – benefits of working in the financial industry. I know the markets will rebound once we get things righted with the economy. The thing is, if you pull out now, you may miss out on all the earnings that will be possible once we do recover. For whatever reason, I’m optimistic about the market rebounding.
7 Ellen // Mar 11, 2009 at 3:46 pm
I don’t feel like I hit any of the previous stages, just acceptance. I guess it’s because I’m young (24), and I know I’ve got a long time for my money to recover. Reading PF blogs has helped me to realize the recession is probably a good thing for me, because I get to start my investing life at such a low point.
8 LivingAlmostLarge // Mar 12, 2009 at 9:42 pm
That’s true Ellen. Doesn’t make it easier to look at though. I had a goal in 2008 to hit $100k in retirement account. I think we ended 2007 very close at like $85k or something. Very doable with just our contributions. Didn’t happen. I believe we are at like $60k or something after contributing $25.5k last year + company match.
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