How many of us are guilty of allowing fear to keep us from doing potentially great things?
ME! I’M GUILTY OF THAT!
I wrote last week about my desire to add a two bedroom rental unit to the side of our house. About 10% of you thought it was a good idea in theory. The other 90% of you thought it was too risky.
- What if I couldn’t find renters?
- How would this effect Baby Ninja if he is raised in a major construction zone?
- Where would we get the money?
Of course, these are all things worth considering, and believe me I have. It is my families well-being on the line after all. There is definitely risk in adding a $100,000 addition to our house
But there is also risk in NOT exploring this idea.
- Our cash savings continues to depreciate since the interest it earns wont keep up with inflation.
- I forfeit the potential to earn $700/mo profit on a $100,000 investment.
- Our house will remain less marketable since we only have one bathroom.
- Etc, etc, etc.
You get the point.
Whether my accessory dwelling unit idea comes to fruition remains to be seen. I got a ton more calculations to do and people to meet with before I can fully wrap my brain around it. But I’ll be darned if I’m going to let some risk paralyze me from doing potentially great things.
A reader of MMM said it best…
Risk cannot be completely eliminated and trying is a fool’s mission. Focusing on eliminating it in one area pushes it into another. I can completely eliminate the risk of flying by never getting on an aircraft (unless one then falls on my head). But that elimination shifts the risk to train, boat, car or bicycle risk. Eliminate all of those and I’m stuck at home, statistically the place most accidents happen. Life is not certain. Ying and yang are the norm. Understanding the risk inherent in anything and that of the alternatives can then inform our choices. That’s about all you can do.
How do you account for risk when you make your financial decisions?