Moral dilemmas are not easy. They make us get in touch with what’s most important to us and how we will make choices based on our values of right and wrong.

As a psychologist specializing in money management, I have worked with children and families on this issue and have been fascinated with how people of all ages justify what they do. The psychologist that is the grandfather of psychological studies on morality and moral judgments is Kohlberg. What he learned over the years is that there are stages of moral development and critical thinking which allow people to make appropriate decisions for themselves, their needs and causes in relation to what’s good and appropriate for society at large. He learned that there were people who made decisions based on the absolute of right and wrong, but many others who used their own barometer of what was right and wrong for them. People will do what they feel they need to do and justify it according to what was most important in their individual situation, but not all. So just like so many other variables in life, we humans differ on the morality scale as well.

So for those home owners who are walking away from their financial obligations to their banks and choosing “strategic default”; i.e. not to continue to pay their mortgage payments because their home is no longer worth what it was even though they can financially afford to do so, it fits. For them, the greater good is to make the right financial decision for their needs and let the bank deal with the loss of value and principal.

Public reaction to this new herd strategy of “strategic default” has been mixed with some aghast at the moral corruptness of such an act while others are in perfect accord and can empathize with the personal situation. In fact, they would do exactly the same thing even though they admit they never thought they would until now.

So what does this new trend say about how we think about what matters most? What would your clients do and why?