Dream Bankruptcy: Understanding The Psychology of Identity & Dream Fusion

Discovering the complex relationship between a person’s identity (self) and their aspirations (dreams) provides a deep insight into the extent to which one’s identity is connected with their dreams and the potential consequences of this complex relationship, which could lead to dream bankruptcy.

Faiq Chong
4 min readJan 16, 2024
Each of us, without a doubt, has dreams that have a particular place in our hearts, dreams to which we are emotionally devoted.

In the world of dreams and ambitions, fascinating psychological phenomena is taking place: the fusion of one’s identity with their dreams. The journey to realising our ambitions frequently begins with a strong connection to the ideal future we want to build. Therefore, it is critical to understand the psychological complexities underlying the merger of identity and dreams, which guides us through the intricate domain of ambitions.

As the fusion of identity and dreams intensifies, emotionally invested in their goals, while inspiring, can lead to a phenomena known as dream bankruptcy. This emotional state represents a significant transformation, in which the early enthusiasm for one’s ambitions fades and gives way to a sense of exhaustion and disillusionment. Hence; existential crisis.

Recognising dream bankruptcy is critical, as it helps us to understand its root causes — unrealistic expectations, fear of failure, external pressures, striving for perfection, and the loss of genuine joy. Understanding these elements is critical for people navigating their professional routes or pursuing long-held aspirations.

Breaking away from dream bankruptcy requires practical tactics like as accepting reality, letting go, broadening identity, and reconnecting with meaning, which guide individuals towards regaining purpose and rekindling their ambitions.

Recognising the psychology of fusion, in which deep emotional attachment or identification with specific thoughts, feelings, or, in this case, dreams, is critical in the complexities of identity and dreams. Also, realigning ourselves away from dream bankruptcy requires practical strategies such as acceptance of reality, letting go of expectations, expanding one’s identity, reconnecting with purpose, and rekindling one’s ambition.

Read this previous article written by me on understanding the causes of experiencing dream bankruptcy, and finding out the strategies to liberate ourselves from it:

The Allure of Identity & Dream Fusion:

Identity fusion is a psychological term that describes an individual’s significant entanglement with a certain component of their identity, where the boundary between self and this particular feature becomes complicated. Identity fusion occurs when individuals firmly intertwine their sense of self-worth, emotional well-being, and general identity with the achievement of certain goals or objectives.

Dreams (or in this context: aspiration), by their nature, evoke a strong feeling of self. Individuals get deeply attached to their dreams, meticulously knitting them into the fabric of their personality. It is a natural response to societal encouragement to dream big, as well as personal involvement in those aspirations. The psychological connection strengthens over time, as dreams evolve from childhood fantasies to high-level career aspirations, signifying a deep and inseparable link between one’s identity and the journey toward realising their dreams.

Consequences of Over-Identification:

While the connection between identity and dreams is powerful, it has its consequences. Over-identification with a certain dream might result in a limited sense of self, and create a narrow definition of who you are. The individual’s self-esteem (worth) and emotional well-being may be strongly tied to the achievement of that specific goal. This intense attachment increases the emotional effect of failures, such as the experience of dream bankruptcy.

Managing Dream Bankruptcy with Psychological Flexibility

Understanding the psychology behind identity fusion might give helpful insights for those dealing with dream bankruptcy. Recognising that dreams are dynamic, fluid, and prone to change enables a more adaptable, flexible identity. Accepting the changing nature of our ambitions becomes a way to escape the traps of over-identification. It is not a separation from dreams, but rather a healthy emotional detachment that allows us to bounce back when we face adversity.

Guidance for a Flexible Identity:

  • Mindful Awareness: Develop a conscious awareness of the connection between identity and our dreams. Regular self-reflection can indicate when attachment becomes over-identification, allowing for path adjustment.
  • Diversification of Identity: As described in previous writings, extend our identity by investigating other elements of ourselves. Engage in a variety of hobbies and interests outside of a single ambition to develop resilience and flexibility.
  • Embracing Change: Recognise that dreams, like identities, are changing. Accept change as a necessary part of the journey. This viewpoint enables a more balanced and adaptable reaction to the ups and downs of achieving one’s goals.

“If you’re setting out to be joyful, you’re not going to end up being joyful. You’re going to find yourself turned toward the sky and longing. If you cultivate the ground beneath you, the grass will grow. If you long for the impossible, you will stay lost and disheartened in the spaces between the stars.” — Jean-Paul Sartre

Jean-Paul Sartre (1905–1980) was a luminary in French existentialist philosophy, renowned as a playwright, novelist, political activist, and literary critic. Born in Paris, his seminal work “Being and Nothingness” establishes him as a key figure in the existentialist movement. Emphasizing individual freedom, choice, and responsibility in a seemingly indifferent and absurd world, Sartre’s intellectual legacy extends beyond his diverse roles, leaving an indelible mark on 20th-century thought.

While dreams bring meaning and drive, over-identifying with them may cause emotional turmoil during challenging times. The advice presented emphasises the development of a flexible identity, which allows individuals to handle dream bankruptcy with fortitude while maintaining a healthy emotional distance from their dreams. Individuals can discover not only the resilience to overcome failures but also the insight to construct a fulfilling and dynamic sense of self by embracing the ebb and flow of ambitions.

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Faiq Chong
Faiq Chong

Written by Faiq Chong

I share values and explore diverse topics (especially on the human condition).