I came into financial planning in the second half of my career. It is truly a calling for me. As a CFP ® , I adhere to a code of ethics that holds competence as a core principle and requires a commitment to lifelong professional education. Because there is always more to learn and new ways to help my clients achieve their goals, I recently began coursework through the Sudden Money Institute to become a Certified Financial Transitionist ® . It’s a natural fit for me, and I’m thrilled to say that after completing Part One of the program, I’m already putting some of the lessons into action.
One of the topics we covered in the first session last weekend was the importance of mindset in how one defines and handles the stress that comes with every life transition. Mindsets exist at two ends of the spectrum, with a growth mindset at one end and a fixed mindset at the other. People with a growth mindset see stress as a challenge, while people with a fixed mindset see stress as a threat. Every transition comes with stress, but your mindset dictates how you respond when something you care about is at stake.
Oddly (or so I thought so at first), one of the most stressful transitions I could think of with my clients is one that is viewed as a positive change: retirement. In nearly every case, approaching retirement is full of a crazy amount of stress. So much for that vision of the happy couple laughing hand in hand as they stroll on the sand! Instead, retirement often comes with a ton of uncertainty, fear, disagreement, and emotional chaos. Here’s an example:
My clients Wendy and Brian have been looking forward to retirement for years. Brian is five years older than Wendy, so he retired a few years ago. Wendy is still working at a job she loves, but Brian wants to travel, hike and fish, and do all the things he’s afraid they’ll soon be too old to enjoy. They agreed on a retirement date for Wendy, and with my help, they’ve been working toward that goal. Now that date is just around the corner, and instead of feeling joyful, Wendy is completely stressed out. When she and Brian met in my office last week, I could feel the tension between them, and despite my best efforts, I couldn’t seem to help them focus on the rational aspects of their retirement plan. Both Wendy and Brian were swimming in emotion, and their upset was palpable. When life changes, money changes—and that’s stressful.
Wendy’s mindset about retirement was a fixed mindset. She had a negative view of stress, and every decision felt life-threatening. When I asked Wendy what she was thinking and feeling, she said, “I realize how confused I am about what my life will look like after I leave my job. Who will I be? What can I afford? Will we have enough money to live like we do now? Brian wants to travel the world, but I’m not sure that’s at the top of my list,” she said. “Everything feels upside down. I realized I’ve been running so hard to get to the end of work that I haven’t been able to face what is beyond. What is retirement? There are so many things I need to understand before taking the leap!”
Brian’s mindset about retirement was a growth mindset. He realized all the changes he would have to address, but he was excited and challenged. Although Wendy and Brian were in sync with their goals and dreams, their different mindsets triggered very different responses to the stress that comes with the transition to retirement. Given that there are two sides to money —the technical and the emotional—our work together will address the emotional side first so Wendy and Brian can rise to the challenge of the next phase of life, connect with others, and learn and grow together.
If your retirement (or another life-changing event) is around the corner, here are three steps to get you started on a path toward your “new normal”:
Step 1: Examine your mindset about stress
By taking a deeper look at how stress triggers your responses, you can harness the power of stress and position yourself to learn and grow. Do you act or react to major change or loss? Are you reactive and closed off, or are you responsive and open? Acting puts you in a growth mindset, while reacting puts you in a fixed mindset. Explore ways to take control of change. Share your stories and your history so you can better understand yourself and those who share your life.
Step 2: Know what’s at stake in the future
This iswhere you move towards the stress to name it, understand it, and embrace it. When life changes, money changes, and this is important. At this stage, it’s important to name your fears. Are you afraid of being a bag lady, or are you afraid of failing to live the life of your dreams? Maybe you’ve always wanted to write a novel, but your career got in the way, and you now have the time to realize your dream. Maybe you want to see the Northern Lights or spend more time with grandchildren or take up a second career (perhaps a service-based career like the opportunities I talked about in my recent blog Inspirations: Finding purpose in your second half of life ). There are no rules. Take the time to explore how you want to live it so you can make it happen.
Step 3: Harness the power of stress
With a growth mindset and a clear idea of what is at stake—for you—you will be more open to opportunities and learning. Now you can work on the technical side of money ; set realistic budgets, set meaningful goals, and strive to build a community of friends and family. Remember that after 50, changes come fast and furious, so when the next change comes (and it will), you’ll have created the capacity to be responsive rather than reactive. You’ll get a little older; you’ll get a little wiser, and the trade-off will be a good thing!
When I meet with Wendy and Brian meet next week, we’ll follow these steps, taking the time to dig into each area to help them find a deeper connection, decrease stress and, most importantly, have a shared growth mindset that will serve them well through this transition and all the rest to come.
Remember: endings bring transitions , and every transition leads to a new normal. Fostering a growth mindset through transitions will enable you to harness the creative power of stress so you can get to your “new normal” with as little uncertainty, fear, disagreement, and emotional chaos as possible.