Sharing Daily Discoveries About Personal Finance And Business Topics

Risk Taking Is A Journey

Inspired by a comment by Joewatch, I thought that I would first make a post about risk taking in general and then divulge into more specific topics later on.

One thing that I have learned is that when it comes to most things in life, to be successful you should be learning something new everyday to grow as a person while also doing something to move forward. Whether you are say starting a new business or trying to find a way to generate more income on the side, in most cases this means that in order to accomplish your goal it will require you to get out of your comfort zone and start taking some risk.

When it comes to risk taking, most people seem to adopt an immediate gratification attitude where if they experience something negative that hurts them right away they simply stop or say it is not worth doing mostly due to fear. Like anything else, you should not let fear dictate what you should and shouldn’t do. When you decide to take a risk in something, what you learn and how you deal with a situation during that process can be just as important as the main goal.

That’s personally my way of thinking and as a result I personally view risk taking as a type of investment where I get to learn and try something new first and foremost. Even if you fail in getting what you wanted, you can’t put a price on the amount of knowledge and experience that you would gain from it. At the same time, just because you failed at something doesn’t mean that you can never be successful at it or that it simply doesn’t work. The bottom line is that you need to actually follow through with your plan/venture to really understand and determine if it is right for you or not.

So how do you get used to getting comfortable in taking risks to enable you to actually get a true analysis if something works for you or not? Speaking for myself, I usually approach it where if I don’t fully understand something then I am not really in any position to say that it works or that it doesn’t (Especially if you see others who are successful with it). As part of the journey, once I determine that it is a worthwhile risk to partake in, my objective at the start is to really get the feel in terms of the positives and negatives which is an important step in being able to analyze something objectively while at the same time learning about the process in general.

A real example for myself would be investing in stocks. Now this isn’t my area of expertise but was always something that I wanted to learn more about. So obviously this would be a risk for me and as mentioned I treat it as a journey and the first step was to really get the feel and understand it. I invested about $1500 and as mentioned the intent for me was to first learn and experience the process. Initially, the value went up very small consitently and then it dropped by a lot. From there I could of easily said something along the lines of unless you invested in something like Microsoft from the start the average person can’t make anything.

Keeping true to my goal, I stuck with it still as I think I would be cheating myself if I didn’t experience the very good side as well. Wouldn’t you know it, The stock went up drastically a few months later and my stock was now worth about $2400. Not bad I thought. I’m sure an experienced person would have sold it off or diversified it in some way, but for myself it was new to me. A few months later, that stock market meltdown occured which people may remember in regards to that China ordeal and my stock lost a lot of value. While I don’t consider myself a stock expert by any means, there is no way I would have been able to really learn and experience what I did if I jumped out right away in the beginning.

So when it comes to taking risks on some kind of venture, treating it like a journey to also make yourself a better or more knowledeable person can help you to eliminate any fear or rash decisions from cheating yourself in learning and experiencing more by prematurely jumping off track. At the same time, taking that risk and sticking with it provides you the opportunity
to create something great as opppose to do nothing.

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