Risk is the normal condition. Risk is everywhere. Risk arises when anything changes.
You may have noticed that change is common and accelerating. Risk is too.
There are ways to look at risk. The classic is the amount of the loss and the probability of an adverse event happening. others involve other dimensions. Time is one. the stock market might be down when you need the money.
Many risks exist because the person has not considered all the circumstances:
If they are affordable, the approach is to minimize the potential loss by care and accept what happens. Everyone leaves an umbrella in a restaurant sooner or later. Driving a car while impaired, or with bad brakes, is avoidable. Being out of shape has risks.
Don’t buy excuses, invest in a solution.
If they are unaffordable, you minimize the likelihood of an event and insure the loss. Your house might burn down, but it is even less likely if you don’t store gasoline in the basement. Insure losses you cannot afford. House insurance with a larger deductible reduces premium. Be sure to insure to value. You might not do very well if you have a partial loss and have underinsured. Check with a professional.
The best insurance situation is high cost / low probability. Low cost high probability events, when insured, have high premiums because of the insurer’s overhead.
If the risk is unaffordable you must eliminate the risk or pay someone else to absorb any losses.
That’s normal. Change happens, people adapt, and new procedures and opportunities come along. Adaptation is on you.
Risk is not always a bad thing. Some risk is about changes that need you to change. Some of them will be positive. Even very positive. There was a time when changing from dial – analog phones to push button – digital phones was an unwelcome change for some. Colour TV. Talking movies. Smart phones. Netflix.
When you see the idea of risk that improves things, you will take more interest in paying attention to it.
If you notice risk and change you will become a more dynamic person.
If you notice and act, you will have a more predictable future.
I help people have more retirement income and larger, more liquid estates.
Call in Canada 705-927-4770, or email email@example.com