Risk Aversion Ahead…Slam on the Confidence Brakes!

Though it’s difficult to truly comprehend their supposed logic or reasoning, we observe that far too many people fear failure less than they fear success. They view, what we believe to be common challenges, as a trigger to apply their confidence brakes.

If these people were playing baseball, the baseball bat would never leave their shoulder. That’s right; they come to the plate never intending to swing at a pitch. This describes those people that fear to take any chance that might bring them success.

So why are they so risk averse? After decades of dealing both professionally and personally with people, I believe the overwhelming factor is their lack of understanding of the nuances of given situations. The facts or the concept of a situation eludes them, so they go into a defensive mode. If they continue living this way, they will, short of winning a lottery, remain between the bottom and (at best) the middle of the ladder, while the rest of us have a shot at climbing higher.

This living, breathing, condition is not just a concept; it is observable in everyday life. Let me provide you some of my examples.

  • Saving and investing for retirement – people often shun investments when they hear or read the phrase, “Some risk to one’s invested principal exists.” Instead of learning that the risk is both minimal and controllable, these people tend to park their retirement money in guaranteed investment vehicles. Over time, these investments typically fail to keep pace with inflation, which results in the principal losing tangible value.
  • Completing tasks and/or projects – I had someone, whom is possibly one of the top computer programmers/coders in North America working with me on a website project. Though for the last couple of years we’d been within touching the finish line to completion, he continued to shift to, or create, other tangents to address. “We want the final to be perfect,” he would say. Nothing in life will ever be perfect.  Being decades his elder, you would think I saw this. Not for a couple of years. Human nature, for a time, seemed to trump chronological age.
  • Taxpayers not challenging their property appraisals – Of course this one is my favorite, since it is what I’ve dealt with professionally. I created a poll asking:  “What do you believe is the number one reason homeowners do not attempt to get their property taxes reduced?” 48% of the respondents selected “Do not understand the process” while the next highest (21%) chose, “Are not aware it can be done.”

Where does this lead us? Lost opportunities by those stumbling in life. Easy marks or targets for those bent on cheating others.

Along with some examples, I’ve provided my slant.

Please feel free to add to my short list?