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| Aralola Olumuyiwa, Accomplished Singer & Drummer |
Am I going to
suggest that money can only be hard won by perilous investments and chancy
ventures? No, I’m not. In that case, am I suggesting caution and that you
should carefully hang on to every penny? No, I’m not advocating that either.
suggest that money can only be hard won by perilous investments and chancy
ventures? No, I’m not. In that case, am I suggesting caution and that you
should carefully hang on to every penny? No, I’m not advocating that either.
What I am suggesting
is that it’s entirely up to you what level of risk you feel happy with – it’s
no good me telling you what that level should be. You have to decide your own
attitude to and appetite for risk. Personally I love the idea of sailing
close to the wind financially. However, my attitude is definitely verging on
the cautious side so I don’t take the risk. I find the risky schemes where you
could blow the lot or make a fortune hold some appeal but I don’t indulge my
whims. I have young children and they come first.
is that it’s entirely up to you what level of risk you feel happy with – it’s
no good me telling you what that level should be. You have to decide your own
attitude to and appetite for risk. Personally I love the idea of sailing
close to the wind financially. However, my attitude is definitely verging on
the cautious side so I don’t take the risk. I find the risky schemes where you
could blow the lot or make a fortune hold some appeal but I don’t indulge my
whims. I have young children and they come first.
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“Life in itself is risky and nothing is certain. How
do you cope when things go wrong? Are you positive, dynamic, enthusiastic and
up? Or do you get all gloomy and depressed and feel the glass is half empty?
Know yourself and know how you cope and how you respond to changes”
Once you have
decided your attitude to risk it makes your planning easier. It allows you to
tailor how you intend becoming prosperous. Hare or tortoise I guess.
decided your attitude to risk it makes your planning easier. It allows you to
tailor how you intend becoming prosperous. Hare or tortoise I guess.
Obviously your
attitude will vary depending on the project. Things to take into consideration
are:
attitude will vary depending on the project. Things to take into consideration
are:
• Your age
– we cope better with risk the younger we are.
– we cope better with risk the younger we are.
• Family
commitments – if, like me, you have young children it does make you more
cautious. If they’ve all left home, you might be prepared to push it a bit
further.
commitments – if, like me, you have young children it does make you more
cautious. If they’ve all left home, you might be prepared to push it a bit
further.
• Income
and/or assets – you need to work out the percentage of your wealth you are
prepared to risk. The more you’ve got, the smaller the risk might be – unless
you are prepared to risk the lot of course.
and/or assets – you need to work out the percentage of your wealth you are
prepared to risk. The more you’ve got, the smaller the risk might be – unless
you are prepared to risk the lot of course.
lf you are going
to take risks, then do try to offset them. Take out insurance if you like:
to take risks, then do try to offset them. Take out insurance if you like:
• Don’t put all
your eggs in one basket (more about this later).
your eggs in one basket (more about this later).
• Consider how
much stress and excitement you can handle.
much stress and excitement you can handle.
• Look at the
timing – long term against quick returns.
timing – long term against quick returns.
• Think about how
much you can afford to risk, worst-case scenario stuff.
much you can afford to risk, worst-case scenario stuff.
• How much
information have you? Too little increases risk.
information have you? Too little increases risk.
The other thing to ponder is how you respond to the
risks of life. Life in itself is risky and nothing is certain. How do you cope
when things go wrong? Are you positive, dynamic, enthusiastic and up? Or do you
get all gloomy and depressed and feel the glass is half empty? Know yourself
and know how you cope and how you respond to changes. And remember that risk
doesn’t mean bad. It means you don’t know how it will all turn out.
risks of life. Life in itself is risky and nothing is certain. How do you cope
when things go wrong? Are you positive, dynamic, enthusiastic and up? Or do you
get all gloomy and depressed and feel the glass is half empty? Know yourself
and know how you cope and how you respond to changes. And remember that risk
doesn’t mean bad. It means you don’t know how it will all turn out.
From The Book; The Rules of Wealth by
Richard Templar
Richard Templar
(Read Rule 25
of Rule of Wealth on Monday at Asabeafrika)
of Rule of Wealth on Monday at Asabeafrika)
Read-to-Wealth Series
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