Help Your Clients Make the Most of Their Regrets

In his latest book, The Power of Regret: How Looking Backward Moves Us Forward, Dan Pink flips regret on its head. Rather than looking to the emotion as a catalyst for guilt or shame, the book focuses on the best of what regret can do for perspective: provide the opportunity to make smarter decisions. Advisors can use this concept to help clients reframe experiences of regret while serving as a thinking partner to find the lessons learned.

"We have this view that it should all be positive, when in fact, what you want is a diverse emotional portfolio. And the most valuable element in that emotional portfolio is regret."

- Dan Pink, guest on Washington Speakers Bureau

Action or Inaction

Pink distills regret into two broad types. The first is action regrets. These come from something we've done, and they often give us a few options. We can a) undo or lessen the regret through further action (e.g., we can apologize to someone we hurt), or b) we can find the silver lining (e.g., a marriage that ended in divorce created a wonderful child).

The second is inaction regrets. These are based on what you didn't do and are typically the regrets we ruminate on most.

"When we're younger, we have about equal numbers of action regrets and inaction regrets...but as we age, inaction regrets take over…with inaction regrets, you can't undo them, you know. It's metaphysically impossible to undo them. And so, they stick with us. They linger. They haunt us in a way."

- Dan Pink, guest on NPR's Life Kit

The Four Core Categories

Previous research sorted regret into domains like romance, education, and finance. Pink saw commonalities across these domains and found that broader categories better encompassed the emerging themes.

Boldness regrets come from something you didn't do. Sometimes taking a chance led to regret, but the research found that people who took action extinguished the nagging wonder of 'what if.' Client examples of boldness regrets might be, "I wish I'd bought this investment earlier," or "I wish I'd quit that lackluster job and started my own business."

Like compounding interest, foundation regrets have the potential to gather force overtime. Examples might be, "I wish I'd saved more when I was younger," or "I wish I'd tried harder in school." An advisor can be a valuable thinking partner to help clients understand how these experiences have led to their current situation and learn ways to avoid future foundation regrets.

To say 'no regrets' is to throw away our best opportunities to learn and grow. Click To Tweet

Moral regrets come from actions outside your boundaries or value system. "I wish I hadn't paid my son's rent after I knew he was an addict," or "I wish I had moved mom in with me instead of to the nursing home" are examples we might hear from clients. In this and all categories, reflecting mindfully on these regrets offers an opportunity to glean lessons and find self-compassion.

Connection regrets are the largest category in Pink's research. They apply to every relationship we share with another person. We might hear examples of connection regrets when clients share how long it's been since they've talked to their parents, children, or friends. The connection break can be dramatic, but it's more often a slow, unintentional drift. Financial tethers run through every facet of our lives, including our relationships. Learning about your client's connection regrets can help you shape a financial plan prioritizing a family trip over a new car.

Do you know what didn't come up much in Pink's research? Regrets about purchasing decisions, not even big ones that feel weighty in the moment. The next time you see your clients ambivalent over a spending decision, filtering that decision through these four core lenses can help bring clarity and confidence.

Elements of a Life Well-Lived

Pink suggests that our regrets are a photographic negative of the good life we want, a value, a purpose, or other elements of a life well-lived. To say "no regrets" is to throw away our best opportunities to learn and grow.

"You could say this regret is a meaningless stranger who I can ignore… you could say this regret is Saint Peter at heaven's gate, passing judgment on my value as a human being. Or you can say, this regret is a teacher."

- Dan Pink, guest on Dare to Lead

When regrets come up in client meetings, don't minimize them. You can help your clients find the lesson by creating some space between themselves and the regret. Asking your client a question like, "What would you tell your future self about this?" can give them an opportunity to self-distance. If a client is particularly hard on themselves, you might ask, "How would you tell your best friend to think about this?" We're usually kinder to others than we are to ourselves. Their answers will help them clarify what they learned and how they can apply that lesson moving forward.

Brenna Baucum, CFP® | Director of Education & Communications at Money Quotient