I have never been a maximizer.
Not at any point in my life, with anything really. But what I realized today is that (likely due my childhood), I have been doing a lot of work to reduce risks, not increase gains. I am not just talking about investing here, though that is affected also. It is more that I am in a state of constant preparation for the worst, which doesn't leave me much to take advantage of the best, as opportunities arise.
There is more value in the upside.
And I know it, but don't act it. I bloody well teach it to people and help them overcome their own limitations so they can enjoy more benefits. Yet, seemingly it has escaped me at how deep it runs within me. Well, I kind of new, but I have never really thought about the implications of it, and have decided to see it more as a strength than a limitation.
It does come from my childhood though, for as I have said before, I didn't have much of a safety net growing up, which means I had to fend for myself. If I made an error, I would be the one to pay the cost, so it made me more careful, risk averse, and calculated in order to protect myself. However, this has also meant that I overweighted failures, even if the costs we low to fail, and undervalued joy. It is a life of survival, and in many ways this mentality has saved me as I have had what some would consider "bad luck" in areas of my life. Had I been a different person, I might not have overcome some of those challenges. Yet, like always, there are positives and negatives to everything. So, while it saved me from the floor, it also held me back from reaching to the skies.
And this is where an analogy with money is useful, because at least for me, it illustrates what the difference actually is. Using a hundred dollars a month as the base earning, if for instance a person is able to save 10 dollars a month with 90 going to expenses, if costs of living increases 5 dollars, there are two things that can be done to save the same amount. Either reduce spending, or increase earnings. The "go to" for the majority of us is to reduce spending, because for some reason that seems like the easier approach.
However, the problem is that if costs of living keep increasing, there is only so far spending can be reduced, before it starts eating into savings. If this continues, it doesn't just eat into savings, but it also generates debt, and debt service obligations, another cost pressure on an already pressured financial situation. It is a losing game, and soon the floor where cutting costs is no longer possible is reached, and there are no additional resources to start building, stress is high, and it is affecting physical, mental and emotional conditions.
When times are tough in the economy, most companies will look to cut back on expenses, getting rid of any fat they might be carrying in their processes, staffing or tech stack. This of course makes sense, because they are acting for profit and have a fiduciary responsibility to their shareholders. However, what they should be simultaneously doing, is looking for ways to make more money, which might actually mean investing into growth. This can work well, especially if a company is able to pick up the market from the gaps that have been left by those retracting or failing.
But, I think there is a human element to the direction we take in this, because a "saving" is one of those immediate effects, where a decision is made to make a cut of some kind, and that cut can be made quickly. Generative activity on the other hand, is not so easy to implement, because it takes planning, investment, creation, implementation, time, feedback, alteration... It might take years.
For me personally, I have been largely stuck in a loop of preparing for and reducing risks, which has an additional impact on my life that is very important to me and can take years to develop too - relationships. Essentially, if times are bad, I am the person you might want to have around, because I will do what it takes to make sure that survival happens. This manifests in the workplace too, which is why I am often the one that gets turned to when there is some kind of delivery required that has a very short timeframe. My solution will be far from perfect, but it will be passable for the needs on short notice.
But I am not the person for good times.
And as sad as this is to recognize, it is also currently true and has been for a while, because I spend so much time considering and prepping for the worst case, that I end up diminishing the good times. I am far more engaged and interested in discussions about the negative state of the world, than I am in talking about a sports game or a show. Even when there are times to celebrate, I am still going to be looking toward the next moment, where the high is gone and the clean up is required.
This doesn't mean that I am a depressive or destroy the mood for other people (mostly), because no matter how serious a topic is, I tend to approach it with a level of humor, albeit dark and sarcastic humor that many people might not fully appreciate. However, I do understand that not everyone is empowered by discussing more serious topics, especially when they are in the mood for partying. I wasn't always this way, so what happened to me?
A lot of bad shit.
I think I have "learned" to be this way through experience and conditioning, where not being prepared for the worst, meant that I had to pay a heavy cost for the circumstances. So, over time I learned to be prepared for what was likely, which definitely wasn't the best outcomes.
So now it makes me wonder, what my life would be like if going forward I shifted my frame and energy to put more into making gains, instead of reducing risks. I wonder if it would improve my experience in life, if I spent time and energy in being a positive force, rather than a damper against the negative. It also makes me wonder if taking this approach will be met by the universe hitting me with the next punch to the gut, once I am again in a state of unpreparedness, to teach me a lesson for trying for the upside.
The universe is always ready to take advantage of a situation.
Taraz
[ Gen1: Hive ]
Posted Using InLeo Alpha
Do we know for certain that there is more upside in risk taking? In terms of the stock market, dollar-cost-averaging Index funds tends to work out better for people over time... your attitude in life might work out for you better. Using Hive as an example, you've kept at it consistently instead of chasing every new thing out there... and I'm sure this will work out better for you.
I don't think it is just in the finance area though, as I prepare for the worst in so many situations, even when the downside gain is minimal. It isn't necessarily about being more risk taking, but maybe shifting some energy into looking at the gain opportunities to grow, rather than the loss opportunities to save - does that make sense?
Oh yeah, that totally makes sense. To be honest, I think I'm definitely like you in this way... where my partner who has an incredibly supportive immediate and extended family is constantly (and confidently) trying new things and creating new things. Sometimes I feel like I'm a good balance for her, but other times I feel like I'm kind of the realistic one/dream shooter-downerer.
It has been not easy to save after pandemic as the prices of everthing increased more than double. We should try to follow opportunities like stocks and cryptos. Hope HIVE will help us...
It is definitely not easy to save now, especially if trying to have some kind of life also. And yeah, it would be nice if Hive could help in some way in the future too :)
minimalistic approach is good and it is a prop to set something remaining for the future. What I see that, minimalism is frugality and thats what keeps one footed to the ground despite having a large wealth on hands to spend.
Sometimes we need to learn vital lessons, to calculate the money and assets and finding other ways to get going during tough times. All the best for the rest.
I kind of feel that the minimalistic lifestyle might have been somewhat overstated, so that people would attempt to be happier with less, while their resources are extracted from them continually. I have never been wealthy enough to get too far from the ground though ;)
Ha ha. Thats a joke, man. You have your limit of reaching the level to try to get your feet off the ground. That indicates despite having something in possession, you can solemn and reserve yourself.
Thats a good trait to have. But as you said, you were minimalistic right from the early days, you know how to get there by keeping low and snow.
I think anyone who focuses or thinking about the challenges to come will never take good moments seriously. I wouldn’t say that is what’s happening to you right now but it looks like it
As long as you are a minimizer, there are times when we should practice the maximizing lifestyle or find a balance between the two
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It's not too late to try. It seems you're in a stable state of life right now, so why not try to do the things you missed before. Take a little risk, knowing you have a safety blanket to fall back on. If you don't like it, you can just go back to how you have always been, or you can incorporate some of what you've learned.
I am pretty risk adverse in general too. I feel bad for my wife because she probably wouldn't mind a little adventure in her life now and then. I have a couple friends who are more adventurous than me, so I now often think what would they do...
I been rejected quite a few times so at this point I rarely even bother asking a girl out on a date.
Sage words my friend, they make a lot of sense and this is a scenario I suspect plays out for many, especially those that are risk averse and financially illiterate.
My advise to you on the question you ponder at the end is to take a measured and balanced approach. No reason why you need to be fully one side or the other, somewhere around the middle works well for me and I can turn the dial slightly in either direction depending on externals and macro situation.