behavioral finance

Retired Husband Syndrome (RHS)

What is retired husband syndrome (RHS)? I first heard of Retired Husband Syndrome at a book signing in 2013. From across the book section in the exhibit hall, I saw a young man with jet black hair staring at the back of my newly-published book, The Mindful Money Mentality: How to Find Balance in Your Financial Future. He turned it over, opened to the table of contents, flipped a few pages, and turned it over again. Until that point, he acted like other book-browsers: look at the back, flip to the front, open to the table of contents, flip to the back, flip it again. Some would then take the book to the register. Others set it back on the shelf. The whole decision took less than 2 minutes. But this young man took so long reading, I wondered if he might consume the whole book right there. Then I got distracted by conversation with another attendee. When I turned back to look for him, he was gone. Figuring he had decided against it, I was surprised a couple of hours later to see he was the first in line at the book signing. Retired Husband Syndrome – in South Korea Approaching with an enthusiastic smile, he said “Hello” in a heavy Asian accent. He was from Seoul, South Korea, (which, considering English was his second language, might explain why he took longer examining the book). He said that he thought the book would be helpful to his male clients. Unsure why he was excluding the female ones, I readied my pen to sign, but asked him to tell me more. “In Asia, we have Retired Husband Syndrome (RHS),” he said. “I’ve never heard of that. What is it?” I asked, putting the pen down. “Some husbands spend their whole lives working for a company, and when they retire, they are at home, and it is not good for the marriage. The husband loses his identity because he is not in his job anymore, and he wants to be home with his wife. The wife has been at home her whole life, but she doesn’t like the husband being there, doing nothing.” “So sometimes the retired husbands do…nothing? They don’t have hobbies or hang out with their friends?” “Yes, that’s right.” “Wow. So you must see a lot of marriage problems in your practice?” “Yes! And it is too bad. They have a pension, but the couples never spend time planning what they will do.” He explained more about the strain on the marriage; the sadness he sees at a time when there could be great joy and celebration; and the effect on their children and the families. "This makes me sad. Sometimes I am going to be the only person outside of the family who might see it. All of the financial advisors in Seoul could help people with this. This is preventable.” Retirement Planning Is About More Than Money I once heard a financial planner say, “We spend…

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5 Identity Theft Types of Pain

5 identity theft types of pain. Yes, identity theft is a pain. Before a family member's recent experience, my thinking was "pain in the neck." It's a nuisance, for sure. However as experienced by this family member recently and by me as the power of attorney holder, it's more than just a nuisance. It can induce shame, violation, hypervigilance, and eventually isolation. Pain Type 1: Shame The family member fell victim to a spoofing scam. The bad guys called her pretending to be AT&T. They convinced her to share the Multi-Factor Authentication (MFA) code which allowed them to steal her phone number through a SIM swap. Although they were unsuccessful with her multiple times at first, it only took one convincing moment that they were really from AT&T and trying to help for her to cave in to their pressure. Three days later, they called me too. The AT&T logo appeared on my screen. I answered it, thinking it was AT&T calling about her phone. Fortunately when I heard the man with the Eastern European accent ask for her, I was hesitant. But not suspicious. Just wondering why AT&T was calling my number (surely they know this number belongs to me?) and asking instead for her. The reason was that my phone number was on a few of her accounts as the MFA device. So her stolen number wouldn't work for those accounts. They needed mine, and were calling to attempt the same ruse that had worked with her. The call lasted all of 26 seconds before he abruptly hung up. Only then I thought, "Hey, wait a minute. I don't think that was AT&T." I felt like an idiot at that point. I even called the number back and it played an AT&T greeting. Fortunately I had not given them any information. Since that time, I have read that a cybercriminal ring bribed AT&T employees which allowed them to impersonate AT&T to conduct their operations. Being a victim is nothing to be ashamed of. Professional criminals are skilled. Yet many victims feel shame at being duped. Pain Type 2: Violation Three days prior to that call, I received multiple email alerts that changes were being made on her USAA profile. It was a Saturday night. I called her to confirm she had not spoken with USAA. She had not. "Hmm," I thought, "We will have to call about this when they're open." I wasn't alarmed. Two days later, a holiday, email alerts began coming from her bank account. The password and mailing address were changed. I knew she had not done this. I certainly had not done this. Who is doing this? Someone is breaking into the bank account and changing information? How did they even know where she had a bank account? How did they get the username and password? Is this connected to USAA? When someone is in your bank account changing personal information, it feels violating. Despite the bank's assurances via hours of calls and visits…

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When Money-Opposites Attract

When money-opposites attract: One's a saver. One's a spender. One would rather be at the mall. The other is into investments. While they love their differences overall, they struggle with disagreements about money. Money is the third most frequent topic of marital arguments, after chores and children. Ironing out the wrinkles in money beliefs, behaviors and decisions can go a long way toward reaching financial goals with peace and harmony - whether those goals be at the mall, or in the savings account. How can couples handle mixed money messages? Try three steps. Step 1: Money Script Awareness Sometimes we don't realize the underlying money beliefs that drive our own and our partner's decisions. These are often called money "scripts." (You can find yours using an online test developed by Dr. Brad Klontz here.) Share with each other the money messages you grew up with. Examples might include "Money doesn't grow on trees," or "You only live once." The goal in sharing is to begin to reach an understanding of the other's background. Share who influenced you when it came to handling money. Money script influences can come from various authority figures - parents, grandparents, teachers, coaches, or spiritual leaders. Share what you believe is the most important value that money provides to you. Values derived from money can include security, achievement, sharing, and spontaneity/having fun. Even a general rejection of money (think 1960s hippie culture) can be a money value. Step 2: Concentrate on conversation Now that the money differences are on the table, how do conversations about it go? It's important to communicate about how you communicate. The goal is for each partner to feel heard and understood. If one or both are falling short on feeling heard and understood, "active listening" is one tool to try. In an abbreviated form of active listening, each partner takes a turn being the sharer and the listener. The sharer tells their story or shares their statement about a topic. The listener then completes three steps. mirror back what they thought they heard, check for understanding, and empathize if appropriate. For example, say the sharer talks about feeling discounted or ignored with important money decisions. The listening partner listens without comment. The listening partner's three steps might begin like this: "So what I heard you say was..." (repeat back, even if it's verbatim, what you heard) "Did I get it all?" (If yes, go to next step. If no, listen to what was missed, and go back to mirroring what you heard.) "I can see how that would be difficult/challenging/etc. for you." Or, if it's true, "If I were in your shoes I would feel the same." This empathetic statement is not necessarily an agreement (although it's nice), but at a minimum an acknowledgement of understanding. All three of these must be completed before it's time to switch roles. Step 3: Respectful Negotiation With enhanced understanding, a couple is better equipped to come to a mutually agreeable solution. Several years ago…

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How To Make Worry Melt

How to make worry melt: As an expert worrier, I often wonder why I worry, even when I know the answer: Worry gives me a (false) sense that I will be prepared and in control. It's my fallback when I feel out of my league. Take this example. One of my biggest worrying times happens before I head to the airport. What am I so worried about? Unlike many, it's not the actual flight. It's about missing the plane. It feels silly to even write this. And yet, Butterflies in my stomach. Little waves of nausea. Tight chest. It happens nearly every time. And I have coping mechanisms: I tell myself things like, "Breathe.“ "Calm down.” “It’s going to be ok.” I even have a special spirit animal - a deer - that I think about to help me feel better. Additionally, as a result of this predictable worry, I have an irrational need to leave home at least two hours ahead, get to the gate an hour before the flight, and, when I get there, to sit where I can see the gate agent and the boarding door. Then there is this acute physical transformation. Once I can see the gate and hear the agent, my entire nervous system relaxes. It feels like the worry just melts. Expected and Unexpected Worries How silly this feels. And yet, it seems I am not the only one to worry about expected and routine things like a departing plane. It's expected and routine, yet a source of great worry, that teenage children will start driving, and that 90-year-old parents should probably stop. In working with money, it's a source of great worry, yet expected and routine, that stockmarkets, interest rates, and gas prices will rise and fall repeatedly. Upcoming retirement is expected and routine, yet a source of great worry (and excitement). Understandably, it's a big step into an unknown future. That can especially bring on the jitters. Adding to everyday events are unexpected random ones, like pandemics. Further, sudden market meltdowns, tsunamis, cancer, dementia, layoffs, election surprises, terrorists, and hacker attacks are all things we know aren't probable, but are possible. Just checking in - how's your heart rate now? Butterflies? Tight chest? Although we might prepare as best we can, worry on top of preparation helps some feel as though we are doing something about the problem. But what toll does worry take? Does it help us to prepare that much better? As a result of worry, I'm quite sure I have shortened telomeres and life expectancy. That's a pretty high cost. How To Melt the Worry Away When I get to the gate and see the agent, I feel the worry melt away. But it's strange - I don't think too many airline employees worry about the same thing I worry about. There's something about having exposure every day to systems and knowledge that produces confidence. Aviation is now one of the safest modes of travel in the world.…

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What’s Your Closet Type? Thrifty Penny, Generous J-Lo, Savvy Suze or Imelda Galore

What's your closet type? Thrifty Penny, Generous J-Lo, Savvy Suze or Imelda Galore On a 2004 visit to Ghana, a west African country, I noticed lots of people wearing second-hand Western clothes. While others donned beautiful traditional garments of their country, it was equally common to see second-hand t-shirts, khakis and jeans. The second hand clothes were sold in nearly every street market. My hosts told me these were commonly called obruni waawu, which literally means, “dead white people’s clothes.” I understood that the clothes looked like those of white Westerners, but “Why dead?” I wondered. Before long, an answer dawned on me. Maybe to Ghanians, many of whom don’t have closets, the only reason a white Westerner would give away perfectly wearable clothes would be because they are dead. To them, clothes might be something you use up until the day they are no longer needed at all. I don't know if this is the actual reason, but it led me to compare and wonder how often we buy new clothes and get rid of old ones. For some, it's quite frequent, and not so much for others. Having seen over 400 budgets in my lifetime, I've noticed spending on new clothes that ranged from $2,000 to $50,000 a year. But what I have not asked and do not know is, how often are the old clothes being thrown out or given away? Money Velocity and Money Supply: Closet Velocity and Clothing Supply There are two concepts in economics that come to mind - money velocity and money supply. Money velocity refers to how many times a dollar changes hands in an economy. There is also money supply, which is the amount of money available in an economy to be spent at any time. Taking this to the closet analogy, what would closet velocity and clothing supply be? Let's say closet velocity refers to how often the clothes on hand are changing. This would mean not only how often new ones are bought, but how often old ones are discarded or donated. Correspondingly, the amount of clothes we have on hand at any point in time would be our clothing supply. Taking four combinations from these two concepts and having some fun with the names, what's your closet type? Closet Type: Thrifty Penny, Generous J-Lo, Savvy Suze or Imelda Galore If you have a low clothing supply and low closet velocity, you might be a Thrifty Penny closet type. This means: you have a small number of clothes that you wear until they have holes, stains, or are otherwise unusable before you replace them you feel ok not being trendy there aren't a lot of choices of what to wear, and you don't require a large closet. Conversely, if you have a high clothing supply and high closet velocity, you started with lots of clothes, are buying lots of new clothes, and are also giving or throwing away old or never-worn ones fairly frequently. This would be the Generous…

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Financial Anorexia? Stuck like Scrooge

Financial anorexia: Stuck like Scrooge. What is financial anorexia? Financial anorexia is a type of spending disorder. People who suffer from the eating disorder of anorexia may obsess about food and the number on the scale. People who suffer from the financial disorder may obsess about money and the number on their bank statement. For those suffering from financial anorexia, they never believe they have enough to enjoy what they’ve got. According to Ken Donaldson, LMHC, a licensed mental health counselor in Seminole, Florida, “Anorexia is characterized by a distortion of perception.” Someone suffering from the eating disorder believes they still need to lose extra pounds, when to everyone else it’s clear they are harming themselves. Someone suffering from the financial one believes they still need more money, when it’s clear they are depriving themselves. While the eating disorder of anorexia is deadly serious and can be fatal, financial anorexia can be dangerous in other ways - to mental health, friendships, and family relationships. Financial anorexics can seem to be more engaged in extreme deprivation than in enjoying life's simple pleasures. Family members are most often affected by the wealthy relative whose reluctance, reclusiveness or reticence are, at a minimum, puzzling, but more often, hurtful. Where Does Financial Anorexia Come From? According to Donaldson, anorexia is fueled by isolation - the more the sufferer depends upon their own distorted perception, the worse their condition becomes. Ebenezer Scrooge (in the beginning of Dickens’ tale) is an isolated penny-pincher and money hoarder. He is the stereotype of the financial anorexic. Another root cause can be fear. What are anorexics often afraid of? Stated fears might include: a catastrophic world event; a very expensive health issue; hyper-inflation; or “spoiling” family members or friends. Certainly some of these things can and do happen. Yet our societal messages, and brains wired to look out for danger, emphasize catastrophic scenarios like these past the point of their actual probability. Yet, other fears might be at work that aren't as overt. Unstated fears might include loss of self-worth or security. Anorexia is also fueled by our cultural norms. Western society still worships conspicuous wealth and Twiggy-like figures. “You can’t be too rich or too thin,” sums it up. Most people understand the “too thin” part, but “too rich”? Is it possible to be "too rich"? Financial anorexics, like Scrooge, typically amass abundant resources. However, their wealth does not come from a healthy relationship with money. They might be "too rich" for their actual needs. Further, the more they have, the more they have to fear losing. The hoarding-like behavior only gets worse the more successful they are at it. What Can Be Done About It? At some point in life, many financial anorexics realize, to their immense regret, that they worried more about what might happen, and didn't, than enjoyed what they actually had. Exposure to new information sources is one method of help. According to Donaldson, “New information will disrupt the pattern.” Support groups, a counselor, and…

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How To Let Go of Money Self-Doubt

How to let go of money self-doubt: What is money self-doubt Money self-doubt is an inner belief that one cannot trust themselves with a decision about money. Sometimes these beliefs operate in the background, quietly driving decisions when we don't realize it. Other times they're front and center. What does money self-doubt sound like? Money self-doubt beliefs often sound like critical messages: "I knew I'd screw it up." "I'll never be good with money." "If I can't manage my own finances, I'm a failure."   "Why am I so stupid with money?" Money Self-Doubt Origins Where does money self-doubt come from?  It could be a single traumatic event or a repetition of harmful moments that lead to flawed beliefs about our financial capabilities. One time being taken by a scammer, or many times being told by an abuser we aren't capable. Without counterbalancing mantras like, "You're still OK." "You just made a mistake." "You can do this." the self-doubt can take hold. Society and media also don't help, offering a choice of money self-image as either, "good with money," or not. Individual instruction is rarely given in school, or in families, much to our society's detriment. While financial professionals are often proficient in finance, many are not good educators. A few even try to make money more complex than it is, to keep clients feeling less than sure about themselves. Case Study: Sondra (not her real name) is a highly educated and accomplished professional. Her parents came from Depression-era families where money was tight in their younger years. Money was never talked about in Sondra's home, although she was given everything she needed. She grew up with the belief that her parents didn't discuss it with her because they believed money was something she was not capable of handling. When she went to talk with a financial advisor, he threw so much jargon at her that she was too uncomfortable to admit she didn't understand what he was talking about. Money Self-Doubt Results Without realizing these beliefs exist, we can allow them to influence what actions we take or fail to take. Self-doubt can affect who we allow into our lives, and who we don't. It can affect our choice of career. Or how we spend, or choose not to, on our own needs, wants, and wishes. Ironically, money self-doubt can lead to overspending with some people, and over-deprivation with others. Sondra chose a career where she was assured a salary and the chance of a bonus if she worked hard enough. She worked longer hours than she wanted to. She lived minimally, foregoing many comforts and rewards of her hard work. Her dreams of having more work-life balance were put on hold because she never felt financially secure. In her personal life, she chose friends and partners who also didn't talk about money, leaving a gap in her closest relationships. How To Let Go of Money Self-Doubt If you've been operating under flawed assumptions, and now you know it,…

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Honey, Ain’t Money Funny? 4 Conversation Ideas

Honey, ain't money funny? Sometimes, not so much. As Valentine’s Day came and went, a couple struggled with questions about consumerism, the meaning behind gifts, and how money affected their relationship. Whether it was financial inequality, overspending, or miserliness (a la Scrooge), humor was hard to find at a time when they were surrounded by hearts-and-happiness messages. What can couples do to have a better relationship with money? Following are 4 ideas. As you try each one, it's a good idea to plan a special fun reward or celebration at the end. The more you practice at these, the easier the conversations will get. You may find your differences become predictable, manageable, and even laughable. Idea 1: Monthly Money Date For monthly money dates, quickies are best. These are for checking the dashboard indicators in your household finances. Agree to limit the conversations to about 15 minutes. Build in fun and humor by focusing on your progress, positive wins, and gratitude for what you've got so far. For big ideas and thorny issues, make a separate date to discuss those using one of the following 3 formats. Then move on to the "real" date part! A 2 1/2 minute video on 3-Part Money Dates can be found here: https://www.youtube.com/watch?v=7TWFKfF0vRQ. Idea 2: 48-Hour Relationship Conference No you don't have to talk about money for 2 days. What a buzzkill! Instead, in a Relationship Conference, each partner takes a turn being a pure listener to the other partner’s issues. Being the listener in a relationship conference means saying nothing while your partner talks. You can decide on the timeframe, but make it somewhere between 15 and 45 minutes. You can take notes. After the first partner shares, take a break from anything money-related for 24 to 48 hours. Allow thoughts and feelings to arise to reflect on what you heard. Then reverse roles. This is the first partner's turn to simply listen. Then wait again for whatever timeframe you decide - 24 to 48 hours. Finally, take turns to summarize what feelings and issues came up. Make sure you give space for listening to each partner's perspective, checking in to make sure you heard them well. Remember to have an activity planned in advance to celebrate your ability to tackle tough stuff. Idea 3: Take Turns Active Listening Another option is to take turns all in one setting being the active listener. Active listening means being fully present to your partner’s issues and emotions without bringing up your own responses or emotions. (Tip: This is really hard for most people who have never done it before.) You do this by repeating back what you heard, checking in to make sure you got it all ("Did I get it all?"), and asking to hear more about the emotions underlying each statement ("You said you felt excluded. Tell me more about that.") Once your partner agrees they feel completely heard and understood, then it's your turn. Again, remember to have something planned in advance…

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When She’s Better Off Than He Is

When she's better off than he is: Some couples find finances difficult to discuss when she makes or has more money than he does. In the July/August 2019 issue of Psychology Today, Esther Perel, a New York psychotherapist, said that women’s liberation has freed them from dependence on men. “But it hasn’t prepared women for men’s dependence on them. Women often have a lot of resentment when they find themselves responsible in the way men have for generations.” In his blog post, “Why Wealthy Divorced Women Don’t Remarry and Men Do” dating coach Evan Marc Katz wondered whether women might rethink their expectations for the man’s financial contribution to the relationship. This makes sense especially when all other aspects of the relationship are equal. After all, many wealthy men remarry to women who are not as financially well off, and why? Companionship, compatibility, and physical attraction. If a wealthy man is happy to pick up the tab for trips and dinners, why aren’t wealthy women? Case Studies Where She's Better Off Here are a couple of cases to illustrate the dynamic. I asked Licensed Mental Health Counselor Ken Donaldson for his thoughts on some fictional case studies. Alan and Donna: Donna is a 53-year-old professor who became disabled after an accident. Her disability is not evident to most people, but at any moment she could be hospitalized. She received a large settlement from the accident. She is making a new life for herself and wants to live well while she can. Alan, her 55-year-old boyfriend, is a painter. He is handsome, romantic and kind to her. Alan does not know Donna’s financial situation. He does know he cannot always afford the restaurants where Donna wants to eat, though. Much of the time she picks up the tab. They both feel awkward about it. Janet and Harold: Janet is a 52-year-old retired author. Her books have sold enough copies that she can live comfortably without working. Her boyfriend, 58-year-old Harold, had an IT career before he was downsized. Since then he has not found a new job or career that seems to be a good fit. Janet loves Harold’s athleticism, his sense of humor and tenderness. They connect on many levels. The problem is, she wants to travel with him to places like Australia, Alaska, and Europe. Neither Harold nor Janet like the idea of Janet paying for the whole trip. Harold does not know Janet’s financial situation, but he does know she is better off than he is. Q & A With Relationship Counselor Ken Donaldson, LMHC Q: How does avoidance of the activities that both couples want to do affect their relationship? A: This would only add to distance in the relationships. Although both people will benefit from doing separate activities that they enjoy, there is much to be lost by leaving the other out when it is motivated by fear and/or avoidance. Q: How could each couple stay together in a healthy way? A: Every healthy, harmonious and lasting relationship…

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Holiday Spending Hangovers

Holiday spending hangovers: What do holiday overdrinking, overeating, and overspending have in common? We can get stuffed in over our heads before we know it, leading to regret later. The holidays can test our temptation to overcelebrate. While holiday alcohol- or food-induced hangovers are commonly discussed, spending hangovers can bring about equal regret. Thinking Ahead To avoid regret, it helps to think ahead. You might call it an "awareness strategy." What events are coming up that might bring about a temptation to overspend? Nowadays, that strategy might start in October. Halloween is now the second biggest holiday for consumer spending after Christmas. What used to be a couple hours of candy collection with a homemade costume and a paper grocery bag is now practically a national holiday. Multi day trunk-or-treating. Elaborate costumes. Yard decorations needing extensions upon extension cords. On November 1, where does all the Halloween stuff go? In the attic, the garage, the storage unit, or the garbage? And what about the candy? Halloween often leads to sugar, spending, and stuff hangovers. Next comes Thanksgiving, where we stuff ourselves with, literally, stuffing. Some then stuff our brains with football and TV. Some families stuff all the important conversations for the past year into a few hours at the table. The air is stuffed with emotions. And spending can often be a coping mechanism for difficult emotions. It seems all the Thanksgiving hangovers - food, football, TV, and feelings - start with stuffing. And finally if you celebrate it, Christmas, the king of holiday hangover potential. Must-have new decorations, the tallest tree, fancy food, family gatherings, parties, gotta-get gifts, candy, cake, and alcohol all stuffed into a few short weeks. Moderation choices might start out strong. But decision fatigue can quickly take over. Come January, depleted bank statements and depleted emotions can bring on the same headaches as too much cookies and eggnog. Thinking ahead to all of the opportunities to spend gives you a head start on avoiding regret later. Ask What is coming up where I will want or need to spend on a holiday? What does the spending event entail? What are alternative ways to achieve my goal for the spending event? Imagine it's January. When you look at your bank and/or credit card balances, what's a reasonable figure for you to be at then? Start with that as your goal. Release Self-Judgment Before launching into ways to criticize decisions before you have even made them, remember that it's ok to splurge. It just takes a little thinking ahead, strategy, self-care and balance. Deprivation generally doesn't work. Mindful Spending Strategies For some people, simply having a January bank balance goal is enough to help them stay focused throughout the season. Others need more concrete ideas. Here are a couple: Plan most or all of your shopping at one or two stores. Buy yourself a gift card for that store with the total amount you can spend that allows you to make your January goal. Ask for…

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