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> It is possible to be wealthy from saving.

The problem is, you have to be wealthy to begin with, meaning you can "stay wealthy" from saving. Or, you have to earn so much that your income is sufficient to save large amounts, far above what is spent. The challenge with the first is, no matter how wealthy you are, saving without an income will bleed resources to nothing eventually. And in the second, getting into a position with high enough income is both challenging, and eventually, that income stops and it ends up being in the first category. 

> Saving toward wealth doesn't work.

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This is no new revelation of course, but it is a good reminder when it comes to how many people use their money. Most want to be wealthy enough to the point that they are comfortable and able to cover both the necessities of daily life, and some level of "extra" along the way, like better versions of a product, service, or more opportunity to spend on experience. And in general, saving doesn't get there. 

So, investment is required in order to create additional income streams, but in order to invest takes accepting risk. Even the lowest risk forms of investment, like paying into a retirement fund, take acceptance of risk, which is why there is normally some level of compulsory contribution into them, otherwise, many wouldn't put any. Paying extra into a retirement fund means accepting the risk that the value in the future will not only be higher than the value today, but also that it will be worth more than what it could be spent on today, like a holiday. Also, it means assuming that the value will be there and accessible in the future, which is a large assumption with the way governments handle economics. 

The thing with risk though, is that while we might intellectually understand it, we experience it much more viscerally as fear. We can logically know what we need to do, but *the doing* takes actions that our body might not want to make. Those of us who are more risk-averse are going to have a far harder time investing into the future than those who are risk-seeking. Because it takes overcoming a dislike hurdle to invest for the averse, but doing something enjoyable for the seeking. Logic tells us to eat healthily and exercise regularly too, yet those things for many are negatives *to do,* not positives - even though they are in our own best interests. 

> We have to *force ourselves* to do what we don't like.

This is also why the earlier we start, the better off we will be. Not only in terms of investing, which compounds and therefore the more time invested, the higher the return - but in everything we do. In terms of investment potential though, the earlier we are able to come to terms with risk-reward mechanisms and make them part of our daily lives, the more likely we are to invest larger percentages of our income into the future, and the earlier we begin. 

The challenge here is that daily life has changed, culture has changed, so we aren't learning the foundational skills needed. For risk, we primarily learn through *experiential play* as children, by running and jumping, climbing, riding and using tools. We test ourselves, often falling down, but in an environment where there is risk, but low cost to failure. 

For instance, I took my daughter ice skating the other day, which is something I started doing as an adult. As a result, I am a terrible skater, because I have a fear of falling, so won't "risk" learning how to slide stop. When my daughter started, she weighed about eight kilos and children are made of rubber, so when she fell, there is no pain, she just gets back up. That is different for an adult of ninety kilos, with inflexible bones. 

But what is interesting to note in these examples, is that a lot of daily life has been pushed into "intellectual" experience, like digital gaming. It is still an experience where a lot can be learned, but it is missing a lot of the *visceral* aspect of learning. The body isn't engaged in the experience in the same way as it would be if the same actions (if even possible) were performed physically. The risk of falling down a cliff in a game is a respawn - that is not the same as hiking through the forest. 

I think that what this does is breaks our risk-reward learning mechanisms to the point that we might actually become *more* risk-taking, but less understanding about the consequences of our action. As a result, we might actually end up investing more percentage wise, but be far less sensitive to the risks of what we are doing. For instance, I was reading about how Gen-Z are far more likely to fall for event ticket scams and lose far larger amounts, because they suffer from FOMO. They are willing to "take the risk" so they don't miss out. 

> But what is the reward worth?

The risk is spent on an experience that might actually have a very small reward, and that experience might not be valuable, because nothing was learned. How many concerts or festivals can a person go to, before they all blend into one another? How many similar experiences can be had before the law of diminishing returns leaves nothing of value left in it?

We have all heard the "learn something new each day" advice. But I would posit that *what we learn* matters more than the amount we learn. The thing with learning though is that no one truly wants to do it, because it is uncomfortable - they want the results of the learning though, and the feeling they get from having learned. Yet, if we consider that we are more likely to do what is familiar because it is comfortable, what we are doing is also limiting the range of what we are learning, diminishing the potential lesson with each event. We might be paying the same or even more to try to get a similar high, but the return on our investment keeps reducing.

> Convenience is a type of saving.

Save time and energy, but for what? The children sitting in front of a screen playing a game are saving time and energy, because they are able to get a similar emotional feeling that they would from going outside and playing, faster and with less risk. It is efficient to get that *feeling,* but it is inefficient to learn the skills necessary to navigate and create the world in which we each live. 

For parents, it is also convenient for kids to play on that screen, because it means less worry about children hurting themselves in the park, and less tears at scraped knees and elbows to kiss better. Kids are safer when they are at home, sitting on the couch, but this is only the case if they are going to *say home sitting on the couch, and safety is limited to *not getting physically hurt* by falling. If safety includes the full range of life experience including physical health and mental and emotional wellbeing, then sitting on the couch playing games, is a *massive risk.*

> Building wealth takes risk. 

Now, the argument here is that richness isn't just having a lot of money and that true richness is in the relationships and experiences we have. Haven't you been reading? Wealth *of experience* means being open to risk, accepting of failure, and the resilience to fall and get back up. These are skills that require practice to build, and those practices start when we are born, perhaps earlier. If we keep limiting our experience to keep ourselves safe from physical, mental, and emotional harm, we are going to severely limit our ability to build a healthy life, even if we do make a lot of money. 

> We need to stop saving ourselves from discomfort.

Yet, that is inconvenient. 


Taraz
[ Gen1: Hive ]


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