Yes, labels are useful as a tool for people to classify people. But I've think you hit three nail on the head that it's liberating to but define yourself with labels in your own head, even when those around you need to label you this or that for their own reasons.

I've found myself worrying less about how I define myself as I've grown older and especially in my late 30s where I'm at now. I just don't really need those labels to validate my identity anymore. And I think we as humans can be fluid in our beliefs and psychological make up, in fact it's healthy 🙂

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