May the Odds be Ever in Your Favour

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When I was studying at university, my aspiration was to become a professional gambler.

That’s right – I wanted to make my millions through betting on football matches. Now, I’m not talking about going to the bookies and taking a punt on the season’s designated punching bag because they are paying $20 to beat the best team in the league and just continuing to place irrational bets because I “have to make it back”. That’s what is known as problem gambling, and I was going to become a responsible gambler.

Hell, I even had spreadsheets, formulas and calculators loaded up in Excel to do my analysis for me. Based on recent form, match location, injuries, and previous head-to-heads, my spreadsheet god would reveal how much to bet on a team win for each team, or a draw, in order to hedge my chances and make a 6% profit or more per match with at least 95% accuracy.

After all, to win money, you just had to be better at picking the likelihood of a winner than the bookmakers, so if I made football my life and immersed myself in team news, form statistics and tips, I might be able to make a lot of money by investing a small amount and then compounding the winnings until I was rich.

Like any new mother will understand, I was proud of my data baby, and wanted to see it take its first steps towards success. But alas, I never did use it. Not a single bet was placed.

Why?

It had a fatal flaw – an unexpected result or two would see my winnings backtrack by weeks, if not months. Every time I went to place a bet to try it out, I got a sick feeling in my stomach and I backed out.

It might have worked, who knows?

But I am still a gambler at heart, and you are too, probably. Most people are to some degree.

It was actually a university lecturer who awoke me to this idea.

“Alright everyone, show if hands – who here considers themselves to be a risk-taker?”

Thinking back to the day before when I had ripped a tag off of my mattress that was clearly marked “do not remove”, I boldly raised my hand.

The pot-head in a beanie at the back of the class was the only other one to raise his hand, and I looked around at the scolding looks of my peers, as every teenager in the room checked to make sure that they were safely aligned with the comfort of the majority.

After all, risk-takers are irresponsible. Everyone knows that!

Well thankfully, the lecturer spared my juvenile ego, and congratulated myself and my fellow-would-be social pariah for being self-aware.

As he pointed out, everyone in the room was a risk-taker.

“After all, you are all here paying to get a degree in a field that you can’t be certain will be hiring when you graduate. You don’t even know for sure that you will graduate, or if you will ultimately decide to work in this industry. That’s quite a gamble with 3 years worth of tuition!”

By the looks on some of the faces in the room, who looked like they had tried to list a house for sale in 2008 and the agent had just told them their property’s market value, the cognitive dissonance was kicking in.

“But this is a field that is in demand! I am guaranteed a job!

Sure, if you had a degree now, you would have a good chance, but who knows what the future holds?

“But I will graduate! I study hard, and I am guaranteed a degree!”

What if you get really sick or sustain a massive injury? What if you fail a key paper just because the professor doesn’t like you? What if you can’t take out a loan for next year or suffer some sort of unforeseen financial hardship, and you have to find a job instead?

Sure, we were playing in “what if?” land and the odds of any of those eventualities happening were slim, but nothing is ever guaranteed, and life can hit you with a thunderbolt at any time.

Home ownership is my favourite one. At the moment, everyone seems to be talking about how home ownership is a solid investment and much less risky than renting, because capital gains only go up. Safe as houses, as they say. Again, I’ll reference the financial meltdown of 2008 and say no more.

If you are reading this post, there is a good chance that you are a blogger or writer yourself. Why do you do it? Most people create blogs as an income source. How many succeed? Frighteningly few. If your motivation is to make money by writing, you are spinning the roulette wheel and your stake is your time.

Think of a successful entrepreneur – any will do. How did they get there? They took a risk.

When Richard Branson started Virgin, the odds were quite high that he would go broke. When you play a game of high-stakes, the consequences get tougher, but the payoff is usually much higher.

Branson’s own headmaster told him on his last day of school that he would either end up in prison or become a millionaire.

Today, he is a multi-billionaire. Why? He’s a risk taker!

I would never take the sorts of risks that he did. I wouldn’t venture into the industries that he did, putting it all on the line.

Most people wouldn’t, but he did, and he won big. Cha-ching!

Risk is ultimately unavoidable, and those who obsessively try to dodge risk are confined to the comfortable prison of mediocrity that they have built for themselves.

There is a time to put the chips on the table and stake it all on red or black. The key to success is how you do it.

I’m not advocating for reckless behavior. I’m not suggesting that you sell your home and invest it all in a business venture that your cousin is starting because he says it will all work out. The “go hard or go homeless” approach terrifies me, and I see it as irresponsible, but risk is an element of the game of life.

The risk-aversion that is hurting your progress probably isn’t in the same ballpark as starting an airline from a fleet of one. I’m guessing it is publishing that post, or sending your CV to that company, or trying to publish that book. Without being flippant, the stakes are likely much lower.

So, given that there is no such thing as a safe bet, how do you be smart about risk?

Picture the worst-case-scenario. Your post gets flamed (or ignored). The company rejects your application. Your manuscript ends up in a publisher’s dumpster.

Can you live with that? If you can, congratulations! You have just made your decision.

If you can’t, manage the risk down as much as you can until you are comfortable with the worst possible outcome. We all have different tolerances for risk. Just bear in mind that the lower the risk, the lower the reward (usually).

Of course, there’s always an element of chance as well. The publisher might have eaten something that disagreed with him at lunch, and your book proposal was the first thing that he reviewed afterwards. Your would-be employer might have just been told that they cannot hire until next quarter.

But remember, fortune favours the brave.

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