Money Shock Management Financial Triage Moving from Fear to Well Being Absorbing the shock of change, regaining balance, and moving forward. By Susan Bradley, CFP, CeFT Founder, Sudden Money Institute
Financial Triage Your Money Shock event has likely brought you to a new and unfamiliar time and place. The way life use to work and the expectations that formed your view of the future may have abruptly changed, perhaps permanently. The initial reaction is normally felt on all levels of life, and particularly in your physiology and state of mind; it can literally be a state of shock. Financial Triage is similar to medical triage in that it s about prioritizing threats and dangers, dealing with the most hazardous ones first, and then moving to a more stable and thorough level of care. Before you can move forward (or get comfortable not moving forward if that s in your best interest), stress levels must come down. Untreated Money Shock can lead to regrets, poor decisions, and the much worse condition of prolonged anxiety. The ultimate goal of Financial Triage is to replace the fear and panic with an increase in control and confidence, which leads a rise in stability and clear thinking.
Financial Triage is four sequential steps to lower stress, increase your capacity for rational thinking and creative problem solving, and ultimately result in stabilization. 1. Normalize 2. Name 3. Organize 4. Prioritize Stabilization
1. Normalize Tell your story of what happened to your financial planner, a trusted friend, family member or advisor. Tell them how you feel now. What do you think this will mean to you, your family, your business, your health and so on. Once you feel like the whole story is out in the open, think back on what was said and try to pick out the individual fears, concerns and worries, and list them. By listing and naming your fears they become less abstract and more manageable.
2. Name Name your fears and concerns. Include all categories money, relationship, self-care, legal, tax, housing and dreams.
3. Organize Once your worries and concerns are named and listed, you can move on to sorting and organizing them according to what is an immediate threat and also what can be controlled. We have three parts for this part of Financial Triage. Part One Sort your list by three categories: Immediate, Possible, or Unlikely. Immediate fears and concerns require your urgent attention; they have the potential to harm your well being now and in the future. Possible threats to your well being are less pressing but still potentially damaging. These fears and concerns may need more analysis as well as some preemptive thinking. Unlikely threats have a low probability of becoming a reality and harming your well being.
Fears Immediate Possible Unlikely
Before we move to Part Two, let s talk about the Happiness Set Point... Transitions take time, measured more in years than months, and when the stress is high and emotions are dramatic, it s good to remember the Happiness Set Point, made famous by Dr. Sonja Lyubomirsky, a professor of Psychology at the University of California, Riverside, who studies happiness for a living. Genetics are 50% responsible for the level of happiness you are likely to experience; your life circumstances are responsible for 10%; and Intentional Activity is responsible for the rest. While things are working themselves out, you might be tempted to think of the things that are out of your control, but remember that there s a lot you can control. 50% Genetic 10% Circumstances, wealth*, career, marriage 40% Intentional Activity, including: habitual thoughts, words and actions *with the exception of the very poor
Part Two The next part of Organizing is to be realistic about the degree of control you have over your concerns and sort them accordingly. Control means you have direct influence and the possibility of eliminating or minimizing the threat associated with the concerns. Manage means you have the ability to proactively manage a concern to minimize the negative potential. Monitor means you do not have direct or indirect ability to determine a particular outcome, but you can monitor a situation and adjust your expectations and plans accordingly. Some Things You Can Control (with the Intentional Actions just referred to) Health Some spending Core beliefs How you interact with others How you worry Free time
Control Manage Monitor Immediate Fears: Possible Fears: Unlikely Fears:
Part Three Now it s time to specify exactly what behaviors you can change/modify, what you plan to in the service of that goal, and what you anticipate for your results. Behavior to be modified Actions Required Anticipated Results
4. Prioritize Finally, you ll use your sorted, organized concerns to create a list of decisions and Action Steps on the next page. NOW Decisions & Action Steps: immediate threats to well being, actions to regain control, behaviors to be modified SOON Decisions & Action Steps: later or more gradually to improve and protect well being LATER Decisions & Action Steps: need more time to pass to make a decision or do anything
NOW Decisions & Action Steps: SOON Decisions & Action Steps: LATER Decisions & Action Steps:
Stabilization Triage Restores Balance Once you have sorted and determined what you can do now to improve your circumstances, you can begin to let it go. You can turn off the worry switch and wash away some of the stress by moving, breathing or humming maybe do all three. The impact of normalizing, naming, organizing is seen when the process is complete. The gnawing fears and concerns no longer progressively lose power, and stabilization starts to replaces them.
What s working well? I am grateful for Gratitude As you feel more calm and settled you may notice your circumstances appear more manageable. Take a few more minutes to appreciate what s working well and what you are grateful for. This works best if you make a gratitude list. I am grateful for