Written by An extreme risk often complicates true reward. This is a big reason why many do not venture down this path. There is a difference, though, between calculated risk and gambling. A calculated risk is not a sure thing by any means, but it is addressed through planning, study, and confidence based on strategy. Gambling, on the other hand, is allowing fate to take the wheel, and you hope for the best. An executive coach, strategist, and speaker, Patti Cotton discussed a big difference between a gamble and a calculated risk. She talked about a gamble being fear-based, where risk is based on the absence of fear or the ability to keep it in check. She said, “But at the foundation of all of this is to have a lower level of fear than most people, or even an absence of fear. Because it is fear that keeps us from considering those decisions and actions that are outside of the box, and that will take our business and career from safe and small to extraordinary.” (Cotton, 2016)
Empowering yourself because of the challenges you have incurred is similar to calculated risk as long as you place it in perspective. Understand that whatever has happened is like eggs that cannot be unscrambled, but you can make delicious omelets. You have gone through a very difficult period and cannot believe that it happened, but the key words here are “have gone through.” You may still be, but you have chosen to move and weather the storm. This action alone empowers you.
Agreeing to take actions that you would not have considered if the circumstance had not occurred has forced you to make risky decisions. For example, changing jobs when you presently feel safe and secure, but in your mind, you see the future, and the writing on the wall does not look good. You have one of two options. You can continue your rinse-and-repeat cycle of living or agree to step off the hamster wheel and into the unknown.
I recently made that decision after looking at a Bloomberg article. Then I read another article from a writer at Charles Schwab. I then listened to some investment news on CNBC and decided. I realized that I would not outlive my income at my age and needed to grow it. Now I would not have made this decision if I was not placed in a situation that was smothered in grief.
I witnessed the death of my wife in 2016 to pneumonia and then the death of my stepmother and father in 2018, literally weeks apart from each other. My daughter had college needs that I could not meet or help her with unless I tapped my investments, so I realized that if I was doing that, then I needed to look at other angles. Between my wife’s death, helping people that I thought were friends, frivolous spending, my child’s college tuition, and bad choices, my investment portfolio was down big time, which meant so was my retirement option.
Many people are looking to play the “time horizon” game. It is a great one to play if you are in your late 20s/early 30s. According to Charles Schwab Investments, in their poll of 1,000 investors, the average retirement target amount was $1.7 million, which was down from $1.9 million in 2021. The article stated that nearly 47% of potential retirees would not meet that goal, and a comfortable retirement is a pipe dream. (Conde 2022)
According to a Bloomberg article from April 2023, over ¼ of Americans, age 59 or older, have no money saved for retirement. After the moves I have made, count me with them. Here is where I separate myself because I am taking a calculated risk approach and “going all in.” It seems ludacris, but I have decided to use my assets to create more assets. No, I am not doing the Vega/AC thing; instead, I have chosen to create a new career for myself. At age 51, I wrote a book, started a podcast, and learned how to speak professionally. I aim to replace my losses, add value to the world, and have a comfortable retirement. These are lofty goals, and big risks are attached, but Nelson Mandela said, “There is no passion to be found playing small – in settling for a life that is less than the one you are capable of living.”
So many call me foolish, but I look at them and think, “Time will tell.” I have chosen not to live within the status quo and realize that to do this, many things in my life must change. Here is where there is a gift in the grief we experience. Change has already occurred, and you can do one of two things. Ignore the realities of change and continue to use old tools to build a new house (It is the choice of many), or take that calculated risk and be brave enough to go against the grain and buck the status quo.
Option 1 is a 100% guarantee of failure, and the other is a 50% shot of success. I have chosen to take the smaller percentage that comes with a chance of succeeding. Many have chosen the 100% guarantee. Because the present is the eye of the storm, that illusion is what has them in a comfort zone, which becomes a prison of their own demise in the future. Looking ahead means that you must plan and start executing without knowing how it will work out but realizing that if you agree to move forward, it will.
Understand that life has already changed based on whatever has happened to you. I had a series of unfortunate events that caused me to make many hard decisions that came with many risks. Still, I am confident in my choices; I have done loads of research, and I am continuing to learn, practice, and fail, but failing is only failure when you give up. The events that led to your grief may whisper for you to give up but see the bigger risk of doing so. There are no guarantees in life unless you set the bar so low for yourself that you are almost guaranteed the win. If you do that, understand that you are fooling yourself.
Although life is a risk, you should not play it to survive. You should play it to win and realize that winning comes with the chance of losing. Do not be afraid of that because if you do, it will keep you from even attempting. Imagine if the Wright brothers simply did not go on Kill Devil Hill and attempt, or if Thomas Edison, after 1,000 failed experiments, gave up. Edison is even quoted as saying, “ Many of life’s failures are people who did not realize how close they were to success when they gave up.”
We all know that change is the only constant in life. We must accept that reality, but change doesn’t have to be bad. In fact, most change is good, even if it stems from something bad that has happened. You will always miss what you have lost, and that is not the good part, but learning from the scenario is. Part of the reward with risk is always learning something new. Either you learn something about the process, or you learn something about yourself. I had no idea of all the talents that I possessed. It is unfortunate how I had to acquire them, but it opened a door I would never have walked through if they had not afflicted me.
I had to realize that within the curse, there was a gift, and part of that gift is the insight that I now own. I am taking a calculated risk that many would not dare because I was forced to see and confront change. Many allow change to take control of their lives and consider it their lot.
Making that decision will keep you in the herd, and if that is where you choose to be, then more power to you, but that type of thinking will not get you to your best; it will allow you to feel like it is the best you can do, but truthfully, it is not. There is no reward without risk. Understand that risk must be calculated and thought out (not overthought because that leads to stagnation). Attempting something that most consider unorthodox means that you have given yourself permission to stray away from the pack, the circumstance that led to your thinking may have been one of those unfair challenges, but perspective matters, and how you see the adversity will allow you to take the risks with the opportunity of reaping the rewards.
Bibliography
Cotton, P., MA,MAOD, PCC (2016, December 7). Gambling vs. Calculated Risk in Business. LinkedIn. Retrieved May 4, 2023, from https://www.linkedin.com/pulse/gambling-vs-calculated-risk-business-patti-cotton/
Conde, A., CEPF (n.d.). Here’s How Much Schwab Says You Need for Retirement. Smart Asset. Retrieved May 4, 2023, from https://www.yahoo.com/entertainment/schwab-says-much-retirement-120000225.html
Cachero, P.(2023, April 17). Many Older Americans Haven’t Saved Anything for Retirement. Retrieved May 4, 2023, from https://www.bloomberg.com/news/articles/2023-04-17/how-much-money-do-i-need-to-retire-a-quarter-of-americans-have-no-savings#xj4y7vzkg
Mandela, N. (nd). There is no passion to be found playing small – in settling for a life that is less than the one. Good Reads. Retrieved May 4, 2023, from https://www.goodreads.com/quotes/49585-there-is-no-passion-to-be-found-playing-small–
Edison, T. A., & BigThink Editor (2015, May 4). Thomas Edison: Many Failed People Were Near Success When They Gave Up. Big Think. Retrieved May 4, 2023, from https://bigthink.com/words-of-wisdom/many-failed-people-were-nearly-successes-when-they-gave-up/#:~:text=May%204%2C%202015-,Thomas%20Edison%3A%20Many%20Failed%20People%20Were%20Near%20Success%20When%20They,success%20when%20they%20gave%20up.%22