A Cliff by Any Other Name…

contributed by Virginia E. Dhondt, CFP® (US and Canada)


Many years ago, a college friend and I “gave up” something every year for a specific time period. It was usually something like candy, donuts, cake or chocolate. This challenge let us know we could do without, but we always went back to eating the same as we had before.

One time, after my college days had ended, I gave up soda. As soon as my time was over, I went back to drinking soda. A few years later, I decided to try it again. I gave up soda, but at the end, I didn’t return to drinking soda. I had an occasional “real” soda as a treat, but I was no longer a soda drinker.

As I thought about the difference, I realized that the first time I told everyone that I gave up soda. The second time, I would say something like, “no thanks, I don’t drink soda.” Without realizing it, I had changed how I thought about and presented my decision—I had learned “reframing.”

Watch out for that cliff!

As I followed the recent news on the fiscal cliff, there were some excellent conversations in the financial planning community about what the various outcomes would mean, but the one that caught my attention was a conversation about the emotionally loaded nature of the term “fiscal cliff.” Does it make you think of the movie “Thelma and Louise” or some similar scene of a cliff you are about to careen over?

The media and politicians seem to adore any term that is sensational, that produces an emotional response to something that could be described in fairly neutral terms. We have witnessed this tendency in many irrational market cycles (bubbles) as well as in the way market volatility is sensationalized to make investors feel they should be taking action. For example, I heard all year about “everyone” getting out of the stock market. Despite all the “get out of the market” talk, the market return was still positive for the year 2012. In fact, most areas of the market did very well for the year!

There is neuroscience behind the use of emotionally charged language which may elicit responses otherwise unlikely. A rational person will not (should not and cannot) always make rational choices, but the choice of words when presenting information or questions may influence the outcome by triggering a more emotional response that can lead to mistakes.

If you find yourself angry or frustrated about the financial “news” you watch, it can help to consider the entertainment aspect those programs are providing. Note the catch-phrases, the emotionally charged words being used, and the triggers; perhaps a one-sided argument is being presented as balanced debate. By disassociating the information from the language, perhaps the emotional response can be reduced or at least reframed. Or you can just watch something else!

Is decision making like jumping off a cliff or taking a curve in the road?

One of the reasons people work with financial planners is that the planner can act like a coach, someone to keep you on track to meet your goals, help you make good financial decisions, remind you of the objectives you want to accomplish, and hopefully help you make any life-changing decisions after considering the emotional and practical implications. If the only advice you ever took was from “that guy on TV,” you probably would be wound up with anxiety. A financial planner can help make general advice very personal and help you feel better about how it fits (or doesn’t) with your overall situation.

A Wellness Journey

A couple of years ago, I found out I had some food allergies. While I was initially unhappy to have to make some very difficult changes to my diet, my previous reframing of the soda challenge had prepared me for this lifestyle change. I wanted to improve my health and I actively sought the next step to take on that journey.

So I don’t dwell on what I can’t eat. I choose to not eat those things—I make this choice for my health. But by focusing on what I can have, what I can do and how I feel while living a healthier life, I can live a life of abundance, not restriction. Even my friends have reframed this change and call food I can eat “Virginia-safe” instead of focusing on what is not there.

Can reframing help you sleep better at night, accept something you have struggled with, or meet goals you have set for yourself? I encourage you to try it. Engage a coach, of whatever profession is appropriate, to assist as you feel necessary on your journey.

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