The story of risk is one of agency, of how our choices shape our trajectory.
“The word “risk” derives from the early Italian risicare, which means “to dare.” In this sense, risk is a choice rather than a fate. The actions we dare to take, which depend on how free we are to make choices, are what the story of risk is all about. And that story helps define what it means to be a human being.” - Peter Bernstein
All big life decisions involve risk:
- Choosing between a safe, secure and well paying job and one which is none of those things but has the potential for more opportunity/responsibility
- Delaying having a family to focus on career
- Moving cities
Our fear, our risk aversion, is the what if things don't work out. The insecure job didn't payoff and creates financial stress. The career isn't as fulfilling as you thought. The new city makes you realise how good you had it in your home town. The marriage becomes a bitter divorce.
When faced with big decisions, consider how asymmetric the outcomes:
“When you face asymmetric risk, it makes total sense to be bold, to grab the opportunity at hand. At the extreme, when the downside is very low (or nonexistent, as in the “nothing to lose” case) and the upside is really high, it’s actually riskier not to make the bold move. The downside of not even taking a chance is emotional: potentially a lifetime of regret and wondering What if? The upside of taking a chance always includes emotional benefits—even if things don’t work out. There’s a great sense of pride at having pursued an important goal wholeheartedly. If you’ve given something your all, you’ll get a lot of positive memories out of the experience no matter what happens.” - Bill Perkins, Die with Zero