Identity Diversification means cultivating a well-balanced set of investments in your sense of self.
“Diversify your investments” is common advice in the world of finance and wealth management.
Throwing all your retirement savings into the current hot tech startup might set you up for a huge payday. But it could also flop, leaving you penniless in retirement.
Because having sufficient finances as we age is so important to our quality of life, most wealth managers and advisors recommend that we diversify our wealth and spread it out. Then, if the stock market crashes, for example, we still have some of our wealth protected in bonds, real estate, etc.
Investment diversity leads to financial resilience.
It struck me the other day, in the middle of a therapy session, that we might apply a similar idea to our own identity and sense of self.
Lack of Identity Diversification Leads to Psychological Fragility
I have a client—let’s call him Tony—who’s been struggling with depression.
Tony retired recently. And far from the idyllic paradise he imagined retirement to be, Tony was miserable:
- He was frequently lonely and irritable.
- He had trouble falling asleep yet couldn’t seem to get anything done around the house.
- He had zero interest in going on the trips he and his wife had always dreamed about for retirement.
- And he generally felt as though his life lacked meaning or purpose.
“I just feeling like I’m floating through my days.” He told me.
As I got to know Tony over the course of a few weeks, one fact about him became crystal clear:
Tony’s life was all about his career.
He was successful as a wealth manager and financial advisor. He built his own firm from scratch and over 30+ years it had done very well.
Unsurprisingly, the success of his business was in no small part the result of Tony pouring his heart and soul into it. He often working long hours day after day and frequently spent whole weekends and even vacations at the office.
But beyond a source of wealth and financial success, Tony’s work was also the place he got most of his enjoyment and satisfaction in life.
All of his friends, for example, were co-workers or business connections. And even in his time off, Tony frequently “leveraged his leisure time” to improve his business — playing golf with a potential client, meeting a business partner for breakfast on a weekend morning, and planning family vacations around work conferences.
It quickly became obvious to me that Tony’s depression was a problem of identity.
Because he had invested nearly all of his time, interests, passion, effort, and even love into his career, that became his primary source of self-worth, satisfaction, and purpose in life.
And when all those sources of “identity income” disappeared after retirement, so did Tony’s entire sense of self.
The Importance of Multiple “Income Streams” for Our Identity
The cautionary lesson from Tony’s story should be clear:
A single, narrow “income stream” for our identity leaves us psychologically fragile and vulnerable to sudden stressors or changes in our environment and life.
Tony’s story is not uncommon in my work as a therapist. Many folks have unwittingly constructed a life that has poor identity diversification:
- Some people over-rely on family or a particular family member for their social support and interpersonal enjoyment, often to the exclusion of friends or romantic partners.
- Many of us over-rely on a single hobby or interest and stop learning about new interests and activities.
- For others, they may over-rely on certain affiliations, only spending time with people of the same faith or political leaning, for example.
And while these narrow identity investments may work for a while, it’s a psychologically risky strategy:
- What happens to our social support when we get divorced?
- Where do we find meaning and purpose in our life once we retire or have a crisis of faith?
- What happens when we’ve built our whole identity around athletics and suddenly develop a debilitating health condition?
When we lack diversity among the sources of our identity, we become psychologically frail and emotionally fragile.
And while many of us take great care to ensure the diversity and resilience of our financial portfolio, are we doing the same for our identity and sense of self?
How balanced is your identity portfolio?