A long word... in Wikihow some simple explanation and suggestions for use.... (how to compartmentalize).
While I never heard of this as a subject in my study of psychology, I realize that this has been a big part of my life, early years... and in the past 25 years of retirement.
Never more important than in the past 5 months which have been difficult due to a health problem that, until the past two weeks, seemed insolvable. Thankfully, and almost miraculously turned around, and hopefully just a memory.
Instead of trying to explain, consider:
Your 18 year old college bound son is arrested for shoplifting
Stock market drops and you have a paper loss of 40%
Your mother is forced to come to live with you because of health
You run over and kill a child
Your house is found to have extensive mold (50K repair) not covered by insurance
Spouse or child diagnosed with incurable cancer... 1 to 5 year prognosis.
Life goes on, but how? How do you deal with this?
Some people take crisis in stride... the fortunate few.
Some struggle for the entire period of recovery, but only lose that part of their life.. and then go on.
Some never recover, and that part of the brain that deals with tragedy goes into a cycle that does not end.
And so the topic... not a financial subject, but a life management option....
To frame, measure, consider best/worst case scenarios, and then to determine the part of the 24 hour day to devote to handling the problem, and to segment this from the rest of the interaction with the world.
Right now, it's up close and personal with us, but looking back, it's a lesson that only came after several years of retirement... In a way, a maturing of judgement.
Maybe not important... Maybe just a natural thing to do... Maybe over analyzing something simple.. but... conscious recognition and compartmentalization works for us.