The Fresh Start Effect

I’ve become a big podcast fan. I stumbled onto one a few months ago when I discovered that Daniel Kahneman was interviewed by Steven Levitt, the co-author of the book Freakonomics. Steven’s podcast is named People I (Mostly) Admire. Most of his interviews are with Nobel Laureates, neuroscientists, and behavioral scientists. It’s heady material that makes you think – but in a refreshing way. It’s been a wonderful respite from political commentary and world news. It was a nice change during exercising, since I’ve now heard every song on the Dan Fogelberg Pandora Station about four hundred times!

After the Kahneman interview, I was hooked. I’ve listened to all forty-three episodes of his series. Episode thirty-four was an interview with Maya Shankar, a child-prodigy violinist who graduated from Juilliard School of Music’s pre-college division and is a former private violin student of Itzhak Perlman.

Unfortunately, she had a huge life change when she injured her hand as a teenager and had to totally reprogram her life. She did well with her fresh start. She received a BA from Yale in cognitive science. She completed a post-doctoral fellowship in cognitive neuroscience at Stanford, after receiving a Ph.D. from Oxford on a Rhodes Scholarship. She is now Senior Director of Behavioral Economics at Google. She also hosts her own podcast called A Slight Change of Plans.

The part of her interview that I found intriguing related to her service as a Senior Advisor in the Obama White House, where she founded and served as Chair of the White House’s Behavioral Science Team. It was right down my alley – applying Behavioral Science to improve the way our monolithic Federal Government functions. Some of these principles were outlined in Richard Thayler’s book, Nudge. Her team’s greatest impact was in helping the young members of our military make better benefits and support decisions.

Needing new podcast material, I began listening to Maya’s podcast which focuses on the major changes people experience. In her fifth episode she interviewed Katy Milkman. Katy is a Princeton grad and her PhD is from Harvard University. She is the James G. Dinan Professor at The Wharton School of the University of Pennsylvania. She is also the author of How to Change: The Science of Getting From Where You Are to Where You Want to Be.

A discussion point that resonated with me was her concept of The Power of a Blank Slate and more specifically a principle that she calls The Fresh Start Effect. To one extent or another, we’ve all experienced this principle. The idea is that we come to points in our lives where, for various reasons, we feel pushed to make a change. Classical economic theory assumes that our preferences remain stable over time unless we face new constraints, new information or price shocks. These items force adjustments to our beliefs or budget. Katy’s research reached a different conclusion.

Katy’s research has shown that there are systematic and predictable moments when our circumstances don’t change, yet we still feel compelled to change. These change episodes are often driven by a desire for a fresh start. Some of these fresh starts can be Calendar-Driven: New Year’s Day, a new Millennium, or Decade Birthdays. Others might be Event-Driven: Starting college, taking a new job, Marriage, buying a House, Divorce, Moving, or Death of a loved one. Our “labels” change. We go from “student” to “working professional,” from “single” to “married,” “renter” to “homeowner.”

Her research demonstrated that these events tend to give humans permission for a “do over.” Sometimes this means an opportunity to feel distanced from past failures. Sometimes they simply offer an opportunity for elevating the quality and fulfillment of life. In either instance there tends to be a desire to be able to feel optimistic about the future.

My mind went to the big change issue that I deal with the most – Retirement. Retirement encompasses both types of change: Calendar and Event. It often means the shedding of important labels such as Doctor, Teacher, Executive, etc. It possibly creates one of the greatest emotional disturbances you’ll experience. It takes you from “what I’ve been” for the last forty years to “what I might become” in my indeterminate future. It has the additional baggage of bringing our mortality more closely into focus. Retirement success has historically been viewed as having enough money put aside to live comfortably without having to continue working. I’m beginning to suspect that retirement success has more to do with navigating these change issues. 

I would like to end with a tidy solution. I don’t have one in my pocket at the moment. Your answer is personal. It is unique to you. I suspect the answer is much like Curly’s Secret of Life advice to Mitch in City Slickers:

Curly: One thing, just one thing.

Mitch: What’s the one thing?

Curly: That’s what you have to figure out.

As always, we are here for you. Please email or call if you want to set up a Zoom videoconference meeting or talk by phone.

Rick Adkins, CFP®, ChFC, MBA

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