I don’t know about you, but I hate going to the doctor’s office. I avoid it at all costs. Personally, the thought of “what if something is wrong with me” can be overwhelming. Or is that just something that I tell myself to justify my avoidance? Honestly, there are a lot of things that I work hard at avoiding in my life. Another one is the scale. I’ve struggled most my life with living a healthy lifestyle and seeing that number on the scale does not make me feel hopeful. I realize that I’ve substituted responsibility in my life with avoidance. I’ve kept telling myself that as long as I don’t pay attention to it it won’t pay attention to me. Remember playing hide and seek as a child? We thought that just covering up our own eyes would keep the others from seeing us. This strategy has not served me well into adulthood.

Several years ago I realized that I was playing this version of hide and seek with another area in my life: money. I thought that if I didn’t pay any attention to it, that I would not have to worry about it. Through some bumps and bruises I learned that no matter what level of involvement I wanted to take, I was still responsible for 100% of the consequences. Taking the road of avoidance caused me to be willingly unaware of potential risks my money was exposed to. Maybe you’re using this “strategy” as well - from personal experience, I can promise you that being willfully ignorant to risk in your life is never a good choice.

The main question to ask yourself is this: Do I even know what risks are present in my life? Do I suffer from the “Ostrich” syndrome, where I just stick my head in the sand and am oblivious to all around me? Or am I active in learning about the risks that rear their heads up in my financial planning?

For example, in addition to market risk, fees are a massive risk to your future earnings. A 1% difference in fees can mean the loss of hundreds of thousands of dollars over a lifetime, and not understanding the difference between an Investor’s Rate of Return (what you make) and Fund Rate of Return (what the fund made as a whole) can mean you go years thinking your money is growing at 8%, when in reality the growth is less than half of that.

Being aware of the risks present in my environment is the first step toward protecting myself from them. There’s no shame in admitting to have been ignorant up until this point - we’ve all been there. However, there is now no more excuse to keep living in ignorance. It is too costly - both for you and those coming after you.

The first thing to consider: What level of risk are your choices creating in your life? And then the kicker: What level of risk are you willing to live with? Not all risk is created equal. What you don't know could be hurting you. Avoiding or postponing learning about what level of financial risk you may or may not have opens the door to financial awareness. Armed with awareness, you can eliminate unnecessary risk. Download

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