There are two ideas I try to live by when betting about the future:
- Only bet what you’re willing to lose
- Frame the future as gains, not losses
Only bet what you’re willing to lose
If I feel that a risky bet is worth taking, I’ll only put in a small amount. Back when Dogecoin was popular, I bought about $20 worth. When Dogecoin tanked, I laughed about my investment.
Similarly, a software engineer like me is no match for a professional trader. I rarely trade securities outside of a simulator.* But when I do, I’ll only put in as much money as I’m willing to lose.
Frame the future as gains, not losses
When I joined Google, my contract stated that I’d receive some company stock after a year. Stock prices can fluctuate wildly, so I plan my finances as if I’ll never receive them! Any amount I gain will be a delight.
And if I ever joined an early-stage startup, I’d consider it an opportunity. I would understand the risk of failure, and if the venture did fail, I wouldn’t think of it as a huge loss (perhaps that’s easier said than done).
That’s how I try to handle betting on the future. Only bet what you’re willing to lose, and frame the future as gains, not losses.
*Over 95% of my portfolio is stock market index funds and bond funds.