Don’t Waste Too Much Time Wallowing In These Two Extremes

Hesitate to turn your personal financial history into today’s money and life regrets

As much as I dislike contributing to an extreme society that paints much of life black and white, I do believe people generally fall — not without nuance — into two categories. At least I have seen this happen repeatedly enough in my life to call it a pattern.

There are people who internalize and there are people who externalize everything from the smallest things that happen in the course of a day to life’s bigger, more meaningful, if not pivotal events.

Internalizers —

• tend to blame themselves.
• look for ways to do things differently next time.
• accept reality — fair or unfair — and proceed with sober and clear caution, colored by persistent optimism.

Externalizers —

• tend to blame everybody and everything else.
• stubbornly stick to what hasn’t worked in the past because … (see the previous bullet point) … it’s everybody else’s fault.
• deny reality — branding it wholly unfair and unjust — and look to manifest outcomes minus meaningful and potentially productive action.

Sounds about right?

We all have temporary tendencies towards both extremes. Often, one far more than the other. The key is spending a minute or, occasionally, a couple of days in that extreme before retreating to neutral ground and going on with the business and fun of life.

This isn’t to say externalizers are all bad and internalizers are all good. Quite the contrary. I can be the most extreme type of internalizer. It’s something I have to work on daily.

Cases in point with money.

Consider this investing situation. I write about stocks and investing for a private client. However, I no longer actively invest in the stock market. Because I don’t have the right frame of mind for consistent trading and investing and being in stocks doesn’t mesh with my current life goals and objectives.

That said —

When Carvana (CVNA) stock tanked to as low as $3.55, I strongly considered it. A mix of logical rationale and the sense that the meme stock crowd would help give it an artificial boost fronted my thoughts. Turns out the latter happened. And, to a degree, Wall Street liked some of the moves the company made. Now the stock trades for around $46.29.

My trusty rearview mirror says a $5,000 investment in CVNA at, say, $4.00, would be worth about $57,863 today.

In 2023, I have had similar experiences with less dramatic stocks. Companies I totally believe in as long-term investments. Uber (UBER) — up roughly 85% so far in 2023. And DoorDash (DASH) — up about 70% in 2023.

I spend too much time beating myself up over this. Lots of negative self-talk where I call myself an idiot and do the math on how much closer I’d be to my goals and objectives if I had just taken a few thousand dollars and purchased these three stocks. This is the bad — actually torturous part — of being an internalizer.

It’s so easy to see nothing other than the all else equal math — $5,000 a few months ago would be nearly $60,000 today. So easy that — as with any compulsion — you relinquish your grasp on reality.

It’s much more difficult to thoughtfully consider the 60,000 other possibilities of what might have — or probably would have — happened before you make the final decision to buy stock and while you own a stock.

Would you have decided on a different stock?

Would you have “chickened out” and invested much less?

Would you have sold “too soon,” out of some blend of nervousness and impatience, leaving money — the real big gains — on the table?

Would you have sold on a volatile drop in the stock and made little to no money or actually lost some?

Using an investing example, that’s a nice, representative illustration of the internalizer’s struggle. But you can adapt and apply it across life.

A micro example — you go into the coffee shop and the barista acts a little cold. You walk out wondering if it’s something you did. Where you rude or did you bring a general energy that triggered this perceived coldness?

Ah, to be an internalizer. To go through these mental gymnastics, feel like you have them sorted after 12 to 24 hours, only to revisit them days, weeks, months, even years later!

I don’t have a great investing example for the externalizer — the stock market’s rigged! — but plenty of broad money instances exist to make a general illustration.

For example, I write about being semi-retired in the face of the reality that many of us will never save enough money to traditionally retire. It’s a massive problem in America. And it’s one we haven’t done a very good job solving. So, like so much else in our society, it gets left to the individual.

The cycle looks a lot like this —

You’re made to feel like you have “failed” as an individual because you can’t do what — mind you — millions upon millions of your peers have also “failed” to do. Everybody from your parents to the retirement industrial complex to the personal financial media encourages you to double down on what hasn’t worked in the past and is unlikely to work for you in the future.

Because I have lived — and am living through — all of this, I write about it. However, as an internalizer, I write about it primarily from a place of accepting reality, dealing with the problem and discussing solutions that work or I anticipate will end up working for me. The hope being that someone else can take my experiences and use them to better inform their own.

The externalizer tends not to do this. Maybe they merely stay the course, because the status quo is relatively easy to maintain. Plus, if you maintain a shitty status quo, it’s much easier to constantly complain. However, they’re more likely to blame external forces, such as government, corporations and society.

And they’re 100% right about much of this blaming.

However, being right and wearing that as your badge of honor, as your identity, as your vanity license plate gets you nowhere fast. It quickly morphs into a state of inaction where you take your problem and make it somebody else’s problem. Even though you know all too well — based on your accurate discovery of unfairness and injustice — that none of these somebody else’s are even close to inclined to really help you. To magically make things fair and just.

If an externalizer decides to write about this stuff, they often do it in a way that makes it appear as if they’re looking for solutions. Like they’re the ring leader corralling all of these smart people who see through society’s games. Unlike the rest of us fools. However, they’re not trying to solve anything. They use hollow optimism as a guise to lure you into their pit of despair.

Misery loves company.

So externalizers often run around shitting on America and talking about how horrible it is that people can’t afford rent, have no, bad and/or expensive healthcare; can’t buy a house; can’t afford to go out to dinner; and will never be able to stop working as they barely makes end meet. If they even make it all.

No doubt, I complain about some of the above and more all of the time. However, the difference between the internalizer and externalizer is that the latter gets bogged down in the complaining and becomes obsessed with and paralyzed by their own drama. The internalizer processes everything, settles on a clear picture of reality and moves on with the business of acting, evolving and doing life.

Realizing who you are — or tend to be in different situations — in this regard matters as much, if not more than anything in life. And definitely with money. There’s no need for distinction really, because money, for better or worse, helps dictates life.

As I move forward with my journey, I could look back and populate my mind with what ifs. I sometimes do. Ruminating on if I just bought this stock or saved more money, I wouldn’t have to spend the time today to position myself to do what I want to do next year or the year after. I could do it now!

However, this hindsight is just as illogical as the stock market example. There’s rarely a clear path between A and B. And especially so when you already navigated the route between two previous points in your life.

People say it all the time. But it never gets easier to accept. You are the culmination of your past experiences. You didn’t do or accomplish whatever you didn’t do or accomplish at age 20, 30 or 40 because it wasn’t the right time. This isn’t to say mistakes weren’t made. It’s only to say what in the hell are you supposed to do about it now other than move forward?

But not only move forward in the straightforward I gotta keep moving forward sense. Move forward in the sense — and this becomes easier to buy into as you get older — that you’re lucky to have new adventures to embark on as you enter another chapter of your life.

Close the book on the previous one, but, like all good readers, take the main points and use them to better execute going forward. That’s called wisdom. Which makes most of us wise, as long as we take the time to focus on what really matters and the things we can actually do something about.

If you’d like to know more about the journey I’m on, follow me on Medium.

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This article is for informational purposes only. It should not be considered Financial or Legal Advice. Not all information will be accurate. Consult a financial professional before making any major financial decisions.