Suppose one day God comes and gives you some supernatural powers. He says “you will be able to see the future of all the people you know, your friends, relatives,…but you cannot prevent a bad event from happening and you will not be allowed to say it to the concerned person”.

So you go to a cousin’s house and see that he is 32 years of age..and he is going to get cancer at age 40.

You go to another friend’s house and find that he is 39..and he is going to die at age 42.

You go to a cousin’s house – he is 43..and you see him living till age of 120.

You go to your daughter’s friend’s wedding and find that they are going to end in a divorce in 5 years time.

You go to another friend’s house and find that his factory is going to be gutted in a fire after 4 years.

What will you do in all such cases?

The ONLY thing you would suggest is “please go to an adviser who can guide you on risk and investments”. Seriously there is nothing else YOU can do. Thinking that you can solve their problems is not sensible. Guiding them to a good adviser is the thing to do.

Now put yourself in a position that you do not know anybody’s future. Not even your own. You could get cancer, or have a heart attack, your factory could get burnt down, ….all these RISKS could happen to you.

Can you AVOID THOSE risks? Are you sure it will happen? If you are 29 need to be prepared to die at 42 or get a crippling illness at 39. Maybe your family would struggle – or maybe they would not. Maybe you would live to 129.

We have zero ability to predict. None of us have it. However, we all know that bad things happen. Happen to the best of the people you know. We can be prepared for it. Partially at least understand that these risks have a low probability of occurring, but will leave a huge impact on your life!

So make sure that all the people you know are well protected. That is all.

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  1. excellent post for reality check!
    The only thing certain about life is – that it will end. After reading your post, however, another thing is certain about life – you need to plan/review your investments every week/month/quarter!!

  2. Risk identification, assessment and management is all about having sufficient barriers to prevent an unwanted outcome, particularly the low probability and high impact ones. Do everything ‘feasible (apply trade-off approach)’ to keep the risks down to “As Low As Reasonably Practicable (ALARP)”.

  3. I admire your way of explaining this concept in very interesting and simple way.

    I haven’t read any better article reg importance of planning and advisor, and can’t think of any better way of explaining.

  4. This is nicely put , for most such things, it is usually not a matter of if but when….plan for the eventuality, cover and live. Thanks

  5. Yes,Precisely for these reasons God does not empower the mortals like us with such powers.
    But,definitely HE shares such ideas through persons like you,Sir
    Basically it is a Cost Benefit equation,which one must keep in mind with respect to future.
    Future has its own shocks (PAINS),for a Benefit to ride that Shock with a Cushion,one has to pay a Cost,that is,accept a Possibility,Be Prepared by sacrificing certain present day benefits(PLEASURES)

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