Don't Let a Global Economic Cataclysm Ruin Your Day

“If you get laid off from a job, especially one that’s central to your identity, go ahead and take it hard,” said Robert Biswas-Diener, who runs the Center for Applied Positive Psychology. “That’s the appropriate emotion.” In other words, accuracy will get you farther than strapping on the rose-tinted goggles.

“People who are overly pessimistic don’t do well, but people who are overly optimistic don’t either,” said Andrew Shatt, a psychologist who co-wrote a 2001 book on resilience and who now counsels corporate clients about leadership. “They tend to get ambushed by things, and sometimes they can’t even see what the problem is.” Only when you see your situation clearly can you take the necessary steps to change it.

This includes people from the job you lost but also, more significantly, those you might have neglected while you were working so hard. The stress of the recession can make you want to hunker down, Shatt says, but you should actually reach out to people more frequently, including family, friends that you may have lost touch with, neighbors, or even volunteers at an organization you want to help. “People who have connections to things outside themselves tend to do better,” Shatt said. “There’s 30 years of research on that.”

Just as there are smart ways to invest your money, there are intelligent ways to spend your money that will, as Biswas-Diener explained, reap enhanced emotional dividends.

First, buy experiences, not things. “The enjoyment lasts longer,” he said. “Instead of buying a new pair of shoes, take tango lessons.” You get the lesson, the anticipation of the lesson, you get to talk about it with your friends, and you now have a new way to entertain yourself. “You’re literally a changed person,” Biswas-Diener said.

Second, spend money on something novel, rather than the tried-and-true. You may have a favorite restaurant, but it’s often better to try someplace new. You’ll pay closer attention, and the experience will be more engaging.

Third, do something with other people. “We’re social creatures,” says Biswas-Diener. “If you’re going to Starbucks, go with a friend, rather than by yourself. Even introverts report being happier when they’re in groups.”

Finally, spend your money in a way that helps other people, even something as simple as treating friends to lunch. Doing nice things for other people takes your mind off your own troubles and also makes you feel good about yourself. Elizabeth Dunn, a professor at the University of British Columbia, published a paper in the March 2008 edition of Science concluding that people who give regular gifts — to people they know or as formal donations to charity — report higher levels of href="http://moneywatch.bnet.com/economic-news/article/how-depressing-is-a-depression/277122">happiness than those who spend primarily on themselves.

If you normally read the business pages every day, cover to cover, scale it back to every other day. Or once a week. According to psychologists, our attention is like a spotlight that can either be tightly focused on a single area of our lives, or widened to include several elements at once. If you spend all of your time and attention looking at business news — especially these days, when it’s so unrelentingly bad — that gloom can take over your thoughts. But if you redirect your attention to other areas of life such as your health, your relationships, or some kind of spiritual element, the financial component, though still just as grim, stays in perspective.

Even if it’s just walking, “you’ll burn off the chemicals from all the stress,” said David Antonioni, a former therapist who now teaches leadership at the University of Wisconsin-Madison.

Don’t sell all your stock, don’t join a monastery, don’t sell your house if you weren’t already planning to. You’re likely acting out of fear, which does strange things to your brain. People who feel threatened tend to revert to primitive behaviors like hoarding that tend to be maladaptive in today’s world, said Dan Stone, a CPA and psychologist at the University of Kentucky who studies people’s relationship to money. “Behaviors like this come from the amygdala, the part of the brain that kicks in when you’re scared,” Stone said, and they evolved to handle physical danger, not financial worries. As hard as it is to grit your teeth and do nothing after watching your retirement account lose half its value, decisions triggered by fear will probably seem rational at the time — and completely irrational in hindsight.

Set some realistic daily or weekly goals to accomplish, and try to devote some time to subjects beyond the job search. Volunteer, take up a hobby, learn a language — anything that lets you increase your competence in small doses and gets you outside of your own problems for a while.

Some psychologists recommend tracking down someone who has helped shape your life such as a teacher or a former boss and thanking them. Others recommend ending each day by reflecting on three good things that happened, even something as mundane as the good sandwich you had for lunch. The thinking is that you can become more optimistic by actively reminding yourself that you have things in your life that are worth appreciating. And that’s a particularly important exercise during times like these.