When looking at a potential course of action, most people are torn between two positions: an eagerness to do something better and a fear of failure. Sadly, most people choose to emphasize the fear of failure.
This is the driving force behind insurance, behind “CYA” maneuvers, and behind procrastination. The saying, “taking care of number one,” is an expression of fear for oneself over whatever is being proposed. A student who operates from a fear of failure will often receive exactly what she fears.
An attitude that reflects a willingness to try is necessary for an adult student. Unlike grade school, in adult education, the possibility of failure must be accepted but not given a controlling influence. A student must be willing to learn new ideas, new techniques, and new philosophies. The student must be willing to listen to the instructor and to do things the way the instructor says rather than the way he has done it in the past. Trying out something new should be the norm for students, not something different.
To accomplish anything worthwhile, there must be risk. Risk can be measured by two factors: how likely failure is and how much of an impact failure would have. These two factors can be determined in any number of ways, from a numerical scale, to a scale of condition such as High, Medium and Low.
I have found a numerical scale from 1 to 10 useful. The two factors are given a numerical rating, with 1 being minimal and 10 being maximal. The risk factor is the product of these two numbers, generating a number from 1 to 100. The goal of risk management is to reduce the risk factor. This can be done by either reducing the possibility of failure or by reducing its impact or both.
Once the risk factor has been determined, then the gain factor must be determined. In financial terms, this comparison is called the return on risk ratio. After this ratio is determined, the person can then decide, based on reality, whether to act or not.
For example, say you are looking at buying a new car. Some of the risks involved are that the car will break down after you buy it, that you will not be able to make the payments, and that the car will be stolen. In each case, you can determine how likely it is that the problem will occur; for purposes, you determine the likelihood of the car breaking down is 4, the chance of you not making the payments is 1, and the chance the car is stolen is 6. The impact of each of these can be determined as well; for the car breaking down, the impact is 3 (the time and money of repairs), for not making the payments 3 (credit rating), and for the car being stolen 4 (the price of the car). To manage these risks, you can do things to mitigate both the chance and the impact, such as taking out insurance, having the car inspected before purchase, and so on. Once these have been determined, then you can determine the gains of having a new car, such as increased transportation reliability, increased mileage, reduction of breakdown events, and so on. Based on the comparison of these two categories (risk and gain), the decision to act can be made.
Risk in Education
While it is relatively easy to make this calculation when considering whether to buy a car, making an effort like becoming an adult student is much more difficult. The problem is that the factors are not as clearly defined, in most cases, so the numbers are not as understandable. Instead, one is faced with an unknown future, which makes for decisions based on emotion rather than factual evidence. So, while risk management is useful in many cases, most people abandon it when faced with life altering decisions. They feel they cannot make a rational decision, so they make an emotional decision, and that means that the stronger emotion controls the decision.
Once the decision enters the emotional stage, the history and social culture become a very strong influence. Our society currently emphasizes the negative results rather than the positive results, which can lead to a darker picture than it should. This emphasis can be seen by the prevalence of news stories, the use of insurance, the incessant clamor of disclaimers, and the use of negative statistics.
However, this picture is unnecessarily negative. By managing the risk, positive results are often the norm rather than the exception. For example, most insurance policies do not have claims made against them. Most products and manufacturers are not taken to court, meaning that the role of disclaimers is negated. Most people, particularly in the USA, are leading lives with a higher standard of living than ever before. By looking at the evidence, a person should have a positive expectation rather than a negative one when considering a new action.
If you believe that life is positive, then you are willing to take chances. You are willing to try something new, something different. This willingness is only enhanced by the presence of the instructor, who is leading you into this new area. By trying a new idea or a new technique, the student gains experience and can make better use of opportunities in the future. Furthermore, trying something new in school is much less risky (because of the reduced impact) than at work or in life, so the rewards are that much more likely to occur.
When I have counseled students, I have found that they have forgotten the positive results of previous efforts and only remembered the negative. This leads to a negative perspective. When reminded of positive results, of successful conclusions, the students have been able to put challenges in a more realistic perspective. The fact of the matter is, most people succeed much more often than they fail, but they have forgotten all the successes. By trying new things, this potential for positive results is more often realized than not. A positive mental attitude is more realistic than a negative one.
About the Author: John Steely has been a teacher for over 25 years, and has been doing financial planning for the last five years. He brings his teaching ability to the field of financial planning, enabling him to explain complex topics in simple terms to help people understand the complexities of finances. Feel free to contact him at email@example.com.