The Paradox of Risk

Having just booked a one-way flight to Barcelona with no idea on how it’s going to end up, I’ve been thinking a lot about risk lately.

In the short term, not taking risks means stability and comfort.
 
In the long term however, avoiding risks and exposing yourself to the occasional bit of volatility and discomfort can make you soft.

You can become a prisoner of your own comfort.

Compare an eighteen year old who leaves school to start his own business, and another who goes to university and gets a job in a large corporation.

The process of starting a business is almost a daily shock to the system. Each day brings with it a new problem. In overcoming each problem the entrepreneur becomes more resilient, and learns skills that he can use for the rest of his life.

Although in the short term, it appears risky – he is in a process of developing a skillset that he can take anywhere in the world and can apply at any time.

Now take the 18 year old who has went to university and took the safe position in the corporation. He has the security of a weekly pay cheque and seems to be in a safe position.

However, if we take a longer view of the situation, it’s a different story.

If for example, an economic crisis hits, the corporation will have to lay off a large percentage of its employees.

His economic security is dependent on the corporation and forces outside of his control.

If a big shock takes down the system he is dependent on, he is in trouble. All he knows is the banking job. Our entrepreneur on the other hand, is self reliant and used to absorbing shocks on a regular basis.

He is used to finding solutions to problems and adapting to new situations. He will make something happen- it’s in his nature.

 

“The three most harmful addictions are heroin, carbohydrates, and a monthly salary.”― Nassim Nicholas Taleb

By doing what you are supposed to – going to university, getting a degree and then getting a job, you are making yourself dependent on a system. If that system sinks, then you will go down with it.

I don’t like the idea of my basic needs- food, water and shelter being dependent on factors outside of my control. As I’ve got older, I’ve felt a growing instinct to become increasingly less dependent on things outside of my control. Almost everything in life can be taken from you, but the more you can depend on yourself, the more freedom you naturally have.

And besides, life is a lot more fun when you don’t know what’s going to happen next.