“True wealth is the ability to love and be loved.”
Leo Tolstoy

Every day, we work hard to earn money. We wake up early, pour our energy into our jobs, save and invest for a better future. Most of us are chasing “financial stability,” hoping it will bring a better life.

But once in a while, it’s worth asking ourselves:
“Am I living for money, or love?”

Ancient wisdom has long warned us about this. Money is a useful servant, but a dangerous master. Francis Bacon once said, “Money is a good servant, but a bad master.” When money becomes the center of our lives, we can easily lose direction.

It all begins with how we care for ourselves. In the pursuit of wealth, we often lose sight of who we are. We sacrifice sleep, health, and even our sense of peace in the name of success. But balance in life starts with loving and respecting yourself.

Confucius said, “The strongest person is the one who can master themselves,” and Socrates warned that “Excess is a vice.” Creating space for rest, simplicity, and self-reflection is not a luxury; it’s self-respect. We must remember not to lose ourselves in the process of chasing financial goals.

Equally important is how we relate to our family. Many people work hard to provide for their loved ones, but in doing so, they often spend less and less time with them. The house may get bigger, but the laughter around the dinner table grows quieter.

The Talmud teaches us, “A poor home filled with love is richer than a palace without it.” Our families need more than financial support; they need our presence, our listening, our love. Even a simple conversation, a shared meal, or an afternoon walk can become a precious expression of that love.

Beyond our immediate circles, there’s also our relationship with others, our neighbors, communities, and the world. The more money we earn, the easier it becomes to retreat into our own comfortable lives. But true wealth expands outward.

Jesus said, “Love your neighbor as yourself,” and the Talmud reminds us that “Wealth without wisdom is easily lost.” We don’t need to donate millions to make a difference. A kind word, a moment of empathy, a willingness to share these small acts create real impact. When our money helps uplift others, it becomes more than a resource; it becomes a reflection of who we are.

Philosopher Epictetus once said, “Happiness doesn’t come from external things, but from how we respond to them.” No amount of wealth can bring peace if it causes us stress, isolation, or emptiness. A healthy money life isn’t about how much we have. It’s about how freely we live, how deeply we connect, and how lovingly we give.

A balanced money life means caring for yourself without neglecting your soul, supporting your family without losing presence, and sharing with others without expecting something in return. In this kind of life, money flows around what matters most, not through it.

And what matters most is always love.

So maybe the real question we need to ask isn’t “How much am I earning?” but rather:
“Am I loving well with my time, with my money, with my life?”

Because the answer to that question will tell you far more about your wealth than any number ever could.

There are moments in life when we desperately wish we could press an “Undo” key. Especially in our financial decisions, we often act out of impulse, emotion, or fear—only to look back with deep regret. Just as we instinctively press Ctrl + Z on our keyboard when we make a mistake, our hearts long for that same option in real life. In the spiritual sense, this desire to “Undo” isn’t merely about erasing errors; it’s about repentance and restoration—a way back to God’s intended path.

One of the most common regrets is impulse spending. At the moment, it feels exciting and justified, but afterward, it leaves us with emptiness and financial pressure. Hebrews 13:5 reminds us, “Be content with what you have,” showing us that true satisfaction isn’t found in possessions but in a heart of gratitude.

Another deeply felt regret comes from rushed investment decisions. Influenced by social media, hype, or well-meaning friends, we sometimes jump into risky investments without proper discernment. The result? Loss, confusion, and shame. In Luke 14:28, Jesus gives a wise principle: “Suppose one of you wants to build a tower. Won’t you first sit down and estimate the cost?” True wisdom, then, lies in prayerful and patient planning—not in panic or pressure.

Showy spending to impress others can also become a source of long-term regret. Whether it’s the latest gadget, luxury brands, or a picture-perfect lifestyle for social media, these often come from a deeper insecurity or need for validation. Yet 2 Corinthians 10:17 teaches us, “Let the one who boasts, boast in the Lord.” Our identity isn’t in what we own, but in who we are in Christ. When our self-worth is anchored in Him, our spending becomes an act of stewardship, not self-promotion.

Sometimes, we regret the financial support we gave to others beyond our capacity—perhaps to family or friends. Motivated by guilt or emotion, we end up overextending ourselves, and sometimes damaging the very relationships we hoped to protect. Proverbs 11:15 says, “Whoever puts up security for a stranger will surely suffer.” Love must be generous, yes—but also discerning. Healthy boundaries are a sign of wisdom, not selfishness.

But perhaps one of the most overlooked regrets is this: using our limited time, money, and energy on everything but God’s calling on our lives. Life is full of demands, and our resources are finite. When we pour all our strength into survival, success, or comfort, but constantly postpone God’s calling with the phrase “maybe later,” we miss the very reason we were created.

Proverbs 3:9 says, “Honor the Lord with your wealth, with the firstfruits of all your crops.” The “firstfruits” here are not just about tithing—they represent our best time, our strongest passions, and our most intentional creativity. God doesn’t desire our leftovers. He calls us to prioritize His purpose with the best of who we are and what we have.

We may wish we could go back and reallocate our time and money toward the mission God put in our hearts. We may long to Undo the years we spent chasing approval, security, or comfort instead of living out our calling. The good news is that God is the God of restoration. In Joel 2:25, He promises: “I will restore to you the years that the swarming locust has eaten.” This isn’t just about financial recovery—it’s a promise that even the time and opportunities we feel we’ve wasted can be redeemed by His grace.

Even when we feel we’ve gone too far or wasted too much, God invites us to return. Not just with guilt or regret, but with a renewed heart, realigned priorities, and a humble surrender. He can reroute us toward our calling, no matter how far off course we’ve gone. That is the spiritual power of “Undo.”

So today, if you feel the weight of past financial or life decisions, take heart. The “Undo” key still works in the Kingdom of God—not by erasing the past, but by redeeming it. With repentance and obedience, you can begin again. And the road back to your calling can start with just one prayer.

Escape Keys for a Wiser Money Life

Classic Proverbs to Help You Step Back and Save Smart

1. Escape from Impulse Buying

“More haste, less speed.” — Korean Proverb

Urgent spending often leads to regret.
Add it to your wishlist first. A day later, you might feel differently.

2. Escape from Comparisons

“Vanity makes the wallet light.” — Latin Proverb

Life on Instagram is filtered.
What you truly need is your own pace and rhythm.

3. Escape from Unplanned Spending

“A goal without a plan is just a wish.” — Antoine de Saint-Exupéry

Spending without a budget is like sailing without a compass.
Do you have your monthly budget plan ready?

4. Escape from the Temptation of Installments

“Debt is the slavery of the free.” — Benjamin Franklin

Small installments slowly erode your financial freedom.
Don’t ask ‘Can I afford this later?’ Ask ‘Can I afford this now?’

5. Escape from Comfortable Ignorance

“Ignorance is expensive.” — Thomas Jefferson

Without financial literacy, someone else profits from your loss.
Invest just 30 minutes a week to learn about money.

6. Escape from Saying ‘Later’

“Now is the least late time.” — Greek Proverb

When it comes to money, the earlier you start, the better the compounding.
Start a small auto-transfer today — it’s never too early.

7. Escape from Negative Beliefs About Money

“Money is a good servant, but a bad master.” — Francis Bacon

Money isn’t good or bad — it’s how you use it.
Treat it as a tool, and you’ll live more freely.

In Summary

A wise money life means pressing ‘Esc’ on what doesn’t serve you,
and ‘Enter’ on what truly matters.

Q: What did you hit ‘Esc’ on today?

Philippians 4:19 says, “And my God will meet all your needs according to the riches of his glory in Christ Jesus.” Based on this verse, here are five key accounting principles related to financial success explained simply:

1. God as a Provider (God’s Provision): God promises to meet all our needs, not necessarily our wants. This can be compared to a balanced budget in accounting—ensuring that income meets essential expenses without overspending. Trust that your financial needs will be provided for.
   
2. Stewardship (Managing What You Have): Financial success requires good management of the resources you’ve been given. In accounting, this means tracking income, expenses, and assets. Being a good steward means making wise decisions, saving, and avoiding unnecessary debt.
   
3. Budgeting (Planning for the Future): Just as businesses create budgets to forecast and control finances, individuals should plan their spending to ensure they live within their means. This shows responsibility, and it reflects faith that God will provide, but you also need to manage what you have wisely.
   
4. Investing in the Right Things (Wise Investments): Just like how companies invest in assets that will bring returns, individuals should invest in areas that align with their values and long-term goals. This could be savings, education, or starting a business, which can generate future growth.
   
5. Gratitude and Contentment (Living with Thankfulness): Financial success isn’t just about accumulating wealth. It’s about being content with what you have and being grateful for it. In accounting terms, this could be seen as recognizing your net worth, but instead of focusing only on growth, appreciating the financial stability you’ve achieved.
   

These principles remind us that financial success comes from good management, wise decision-making, and trust in God’s provision.

There are many reasons why individuals are bound to fail in the stock market. I will explain the five most important reasons.:

1. Being influenced by emotions
   Stocks are highly volatile, so many decisions are made emotionally. For example, when the stock price falls, people sell out of fear, and when it rises, they buy in hopes that it will continue to go up. Making buy and sell decisions based on emotions increases the likelihood of being wrong and leads to failure.
   
2. Chasing short-term profits
   Many people in the stock market want to make quick money in the short term. They often follow stocks that are skyrocketing or keep reinvesting after losses. However, this is mostly risky and makes it difficult to achieve sustainable profits.
   
3. Lack of information
   To invest in stocks, you need sufficient information about the company and the market. However, individuals often trade without properly researching, which can lead to significant losses if the information is wrong.
   
4. Lack of diversification
   Some people trade all their money in a single stock. If that stock experiences a significant drop, they will suffer major losses. Diversifying investments across multiple stocks can reduce risk, but this is often overlooked.
   
5. Failure in risk management
   Risk management is crucial in stock trading. However, many people fail to consider risk before trading and continue to trade until they are unable to bear any further losses. This can lead to substantial financial crises.

Accounting principles serve as the foundation for accurate financial reporting and responsible financial management. These principles guide the preparation, presentation, and interpretation of financial statements, ensuring transparency, integrity, and reliability in financial reporting. Interestingly, many of these accounting principles align closely with biblical values, reflecting timeless truths about honesty, stewardship, and ethical conduct.

1. Accuracy and Truthfulness: The principle of accuracy in accounting emphasizes the importance of presenting financial information truthfully and without bias. This principle resonates with biblical teachings on honesty and integrity. Proverbs 11:1 states, “The Lord detests dishonest scales, but accurate weights find favor with him.” Just as accurate weights and measures are pleasing to God, accurate financial reporting reflects a commitment to honesty and truthfulness.
2. Transparency and Disclosure: Transparency is a fundamental principle of accounting that requires companies to provide clear and comprehensive information about their financial position and performance. This principle aligns with biblical values of openness and accountability. Ephesians 5:13 encourages believers to “have nothing to do with the fruitless deeds of darkness, but rather expose them.” Transparent financial reporting allows stakeholders to make informed decisions and promotes trust and confidence in financial markets.
3. Conservatism and Prudence: The principle of conservatism in accounting advises caution in financial reporting, erring on the side of understating rather than overstating assets and income. This principle reflects biblical wisdom on prudence and careful stewardship. Proverbs 27:12 admonishes, “The prudent see danger and take refuge, but the simple keep going and pay the penalty.” Just as the prudent person exercises caution in the face of danger, conservative accounting practices mitigate the risk of overestimating financial performance and assets.
4. Stewardship and Accountability: Accounting principles underscore the importance of stewardship and accountability in managing financial resources. This resonates with biblical teachings on stewardship, emphasizing faithful management of resources entrusted to us by God. Matthew 25:21 conveys this message: “His master replied, ‘Well done, good and faithful servant! You have been faithful with a few things; I will put you in charge of many things.'” Accounting practices that promote transparency, accountability, and responsible stewardship honor God’s ownership of all things.
5. Consistency and Comparability: Consistency and comparability are essential principles in accounting, ensuring that financial information is presented in a uniform manner over time and across different entities. These principles facilitate meaningful analysis and decision-making. This aligns with biblical values of fairness and impartiality. Proverbs 20:10 states, “Differing weights and differing measures— the Lord detests them both.” Consistent and comparable financial reporting promotes fairness and integrity in financial transactions.

In summary, accounting principles not only provide a framework for accurate financial reporting but also reflect core biblical values such as honesty, transparency, stewardship, and fairness. By aligning financial practices with these timeless truths, individuals and organizations can uphold ethical standards and demonstrate integrity in their financial management.

In the realm of investment, the allure of financial markets and asset classes often takes center stage. Yet, amidst the clamor of stocks, bonds, and real estate, there exists a potent yet often overlooked avenue for true wealth creation: investing in yourself and your own business.

The Power of Self-Investment:

Investing in your own abilities is a transformative act of self-empowerment. Whether through education, skill development, or personal growth initiatives, allocating resources towards enhancing your knowledge and capabilities yields dividends that far surpass monetary returns.

Unlocking Potential:

By investing in yourself, you unlock the doors to untapped potential and limitless possibilities. Whether you’re honing your expertise in a particular field, mastering a new skill, or nurturing your creative talents, each investment in yourself lays the foundation for future success and fulfillment.

Building Your Business:

Similarly, investing in your own business is a testament to belief in your vision and entrepreneurial spirit. Whether you’re launching a startup, scaling your existing venture, or pursuing innovative ventures, directing resources towards your business endeavors is a strategic investment in your future prosperity.

True Investment Unleashed:

In the grand tapestry of investment, the most profound returns often stem from investments in oneself and one’s entrepreneurial ventures. While financial markets may fluctuate and asset values may rise and fall, the value of personal growth and business success endures as a beacon of true investment unleashed.

Conclusion:

As you navigate the complex landscape of investment, remember that the most valuable asset you possess is yourself and your capacity to innovate, adapt, and thrive. By investing in your own abilities and business, you embark on a journey of self-discovery, growth, and prosperity that transcends the confines of traditional financial markets. Embrace the power of self-investment and unleash the true potential that lies within.

In the labyrinth of personal finance, bad habits can serve as insidious obstacles, hindering our progress and undermining our financial well-being. From impulse spending to neglecting savings, these habits can wreak havoc on our money lives if left unchecked. It’s time to shine a light on these destructive patterns and take proactive steps to break free from their grip.

1. Impulse Spending:

At the heart of many financial woes lies the temptation of impulse spending. Whether it’s indulging in unnecessary purchases or succumbing to the allure of instant gratification, impulsive spending erodes our savings and derails our financial goals. Recognizing triggers and practicing mindful spending can help curb this destructive habit.

2. Living Beyond Means:

Living beyond our means is a perilous tightrope walk, teetering on the edge of financial instability. Relying on credit to finance a lifestyle beyond our income leads to mounting debt and perpetual stress. Embracing frugality, prioritizing needs over wants, and adhering to a realistic budget are essential steps towards financial sustainability.

3. Procrastination and Ignorance:

Procrastination and ignorance are twin saboteurs lurking in the shadows of financial ignorance. Delaying crucial financial decisions or turning a blind eye to money matters only exacerbates our problems in the long run. Educating ourselves about personal finance, confronting our financial fears, and seeking professional guidance can dispel the fog of uncertainty and empower us to make informed choices.

4. Neglecting Savings and Investments:

Neglecting savings and investments is akin to neglecting seeds that could sprout into a bountiful harvest. Failing to prioritize savings for emergencies, retirement, or future goals leaves us vulnerable to financial shocks and missed opportunities for growth. Cultivating a habit of regular saving and adopting a diversified investment strategy can lay the foundation for long-term financial security.

5. Emotional Spending and Lifestyle Inflation:

Emotional spending and lifestyle inflation are stealthy thieves that quietly pilfer our financial resources. Using retail therapy to cope with stress or succumbing to the pressure of keeping up with societal expectations leads to a cycle of overspending and dissatisfaction. Embracing gratitude, cultivating contentment, and reassessing our values can help us break free from the shackles of materialism.

Conclusion:

In the crucible of personal finance, bad habits can cast long shadows over our financial futures. However, by confronting these habits head-on, adopting healthy financial practices, and nurturing a mindset of growth and empowerment, we can pave the way towards financial freedom and abundance. It’s never too late to rewrite the script of our money lives and embark on a journey of transformation and prosperity.

The asymmetric payoff, with its promise of significant gains relative to the initial investment, can be an alluring prospect for adventurous investors seeking high-risk, high-reward opportunities. However, behind the allure lies a landscape rife with potential pitfalls and risks. Let’s explore some examples of the risks associated with asymmetric payoff:

1. Cryptocurrency Volatility:

• Cryptocurrencies, like Bitcoin and Ethereum, have captured the imagination of investors with their potential for asymmetric payoff. However, the volatile nature of these digital assets means that investors can experience dramatic price swings in a short period. For example, Bitcoin’s price surged to nearly $65,000 in April 2021 before plummeting by more than 50% in subsequent months.

2. Penny Stock Speculation:

• Penny stocks, often trading at low prices and with small market capitalizations, are another arena where asymmetric payoff can be pursued. However, these stocks are highly speculative and can be susceptible to manipulation and pump-and-dump schemes. Investors may experience substantial losses if the underlying companies fail to deliver on their promises or meet expectations.

3. Biotech Breakthroughs:

• Investing in biotechnology companies on the verge of a breakthrough drug discovery offers the potential for asymmetric payoff. However, the biotech sector is fraught with risks, including regulatory hurdles, clinical trial failures, and patent expirations. Investors may see their investments plummet if promising treatments fail to materialize or face unexpected setbacks.

4. Startup Investments:

• Investing in early-stage startups can provide an opportunity for asymmetric payoff if the company experiences exponential growth or is acquired at a substantial premium. However, startups are inherently risky, with high failure rates and uncertain revenue prospects. Investors may lose their entire investment if the startup fails to gain traction or secure additional funding.

5. Options Trading:

• Options contracts offer the potential for asymmetric payoff, allowing investors to leverage their capital and amplify returns. However, options trading is complex and can lead to significant losses if not executed prudently. The asymmetrical nature of options means that investors can lose their entire investment if the underlying asset doesn’t move in the anticipated direction within the specified timeframe.

Conclusion: Asymmetric payoff presents tantalizing opportunities for investors to achieve substantial gains with relatively modest investments. However, it’s essential to approach these ventures with caution and awareness of the inherent risks involved. By understanding the examples of asymmetric payoff risks and implementing robust risk management strategies, investors can navigate the speculative landscape with greater confidence and resilience.

“Healthy money” generally refers to the concept of managing one’s finances in a way that promotes overall well-being. It involves making sound financial decisions, budgeting wisely, and investing in a manner that supports long-term financial health. Here are some key aspects related to “healthy money”:

• Financial Literacy: Understanding basic financial concepts, such as budgeting, saving, investing, and managing debt, is crucial for making informed decisions.
• Budgeting: Creating and sticking to a budget helps ensure that you allocate your money wisely, prioritize essential expenses, and save for future goals.
• Emergency Fund: Having an emergency fund can provide a financial safety net, covering unexpected expenses and helping to avoid high-interest debt.
• Saving for Goals: Setting and working towards financial goals, such as buying a home, education, or retirement, is an essential part of maintaining financial health.
• Investing: Investing money wisely can help it grow over time. Diversifying investments and understanding risk tolerance are key factors in building a robust investment portfolio.
• Debt Management: Responsible management of debt, including credit card debt and loans, is crucial for maintaining a healthy financial situation.
• Insurance: Having appropriate insurance coverage, including health, life, and property insurance, is important to protect against unexpected events that could have a financial impact.
• Financial Planning: Developing a comprehensive financial plan that takes into account short-term and long-term goals can guide your financial decisions and help you stay on track.
• Mindful Spending: Being conscious of your spending habits and making intentional choices can contribute to overall financial wellness.

It’s important to note that individual circumstances vary, and what constitutes “healthy money” can differ from person to person. Seeking advice from financial professionals or using reputable financial resources can provide personalized guidance based on specific situations.

We often.. use the term opportunity cost to refer to the sacrifice of a choice.

The loss of other alternatives when one alternative is chosen.

In short, your choice should be better than other opportunities.

However, the world is becoming more profitable by not choosing.

I’d like to call it

Opportunity Profit.

The Profit By Avoided.

In a world overflowing with new choices every second, it’s easy to get lost.

The five senses are constantly stimulated and eventually become numb.

Exit!!!

A way out is needed.

Don’t try to know other than the way you should go.

Save time.

The world is evil

Both spiritually and physically

Because time is the most important resource.

Making the most of every opportunity, because the days are evil.

Ephesians 5:16 

But when you are tempted, he will also provide a way out so that you can endure it.

1 Corinthians 10:13

Everyday we are caught up in an addictive environment.

Alcohol, drugs, medicines, tobacco, work, shopping, games, gambling, stock trading, cryptocurrency, competition, smartphones, SNS, etc. However, other personal addictive behaviours such as collection, consumption, and activity cannot even be identified. We are busy with addictions after all.

Due to the COVID-19 situation, the essence of human relationships is moving more rapidly from the face-to-face world of the real world to the non-face-to-face virtual world. The environment has become more and more suitable for addiction. You may find unexpected addictions in new things in your daily life.

In the virtual world, we eventually become paralyzed by emptiness, anxiety, and escape from reality. Externally-induced fear prevents us from recognizing our true need. Addiction makes you forget important issues for a while and makes things worse. The more you do it, the stronger and stronger you fall into addiction.

Especially in the money world, profit and growth addiction has become a social system. Social organisations such as individuals, schools, and corporations are connected to the mutual addiction system, so addiction is generalised.

Money itself already has become the purpose and direction of life.

Money cannot replace the purpose and direction of life and requires a fundamental change in perception so that it can be used as a means.

IMPORTANT DISCLOSURES
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

Spending plan?

Your spending plan is your active strategy for getting where you want to go. Think of your spending plan as a road map that helps you reach your goals, as well as give you a sense of direction. Your spending plan not only puts you in charge of how your money is being spent on a weekly, monthly, and yearly basis, but it also gives you a sense of control.

What are the steps to develop a spending plan?

It takes some time and effort to develop a spending plan that is right for you and your family. Of course, there are guidelines provided by experts that you can follow, but in the end, you need to develop a plan that you can follow. Here are the steps you can take to develop your own spending plan:

• Create a spending diary
• Identify out-of-pattern expenses
• Estimate your income

IMPORTANT DISCLOSURES
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

• Don’t trust your resolve.

• Don’t leave the account behind.

• Don’t keep a memory on. Memo on.

In the investment world, risk means uncertainty, and refers to the possibility that you will lose your investment or that an investment will yield less than its anticipated return. That uncertainty about the outcome of an investment means that investment risk also refers to the way the price of an investment fluctuates or changes in value from time to time–its price volatility. The more the fluctuation–in frequency and in amount–the higher the volatility. Generally, the higher the volatility, the greater the uncertainty about the outcome of your investment, and the greater the potential risk involved.

There are three factors that are key to understanding risk: (1) the risk-return tradeoff, (2) the investment planning time horizon, and (3) the different types of risks that exist. You should have a solid understanding of each of these issues in order to select investments that maximize potential returns within your acceptable risk levels. Here is a brief discussion of each.

(1) Risk-return tradeoff

As risk increases, the potential for return increases. This is known as the risk-return tradeoff. Historically, investments with greater risk have tended to provide higher returns, though past results are no guarantee of future returns. The more aggressive you are as an investor, the more risk you take, and the greater chance you may have to earn a potentially higher return (assuming any return is earned at all). Conversely, the more conservative you are as an investor, the less risk you take, and the less potential you have to earn a high return (though you’re also less likely to lose your investment).

(2) Investment planning time horizon

The length of time you plan to stay invested in a particular vehicle is referred to as your investment planning time horizon. Generally speaking, the longer your time horizon, the more you may be able to afford to invest more aggressively, in higher-risk investments. This is because the longer you can remain invested, the more time you’ll have to ride out fluctuations in the hope of getting a greater reward in the future.

(3) Different types of risks that exist

Finally, many types of risk can affect an investment. Each investment is subject to all of the general risks associated with that type of investment. Risk also arises from factors and circumstances specific to a particular company, industry, or class of investments.

Note: All investing involves risk, including the potential loss of principal, and there is no assurance that any investment strategy will be successful.

IMPORTANT DISCLOSURES
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

How do you feel about taking risks?

Take this short quiz:

1. Do you put on the car brake when the traffic light turns yellow, or do you step on the gas? If you put on the brake, give yourself one point. If you step on the gas, give yourself three points.
2. Do you fill the gas tank when the needle reaches halfway, or do you run a few miles on empty? If you fill the tank halfway, give yourself one point. If you run on empty, give yourself three points.
3. Do you take the long way because it’s the way you know, or will you take a shortcut you’ve never taken before? If you take the long way, give yourself one point. If you’ll take the shortcut, give yourself three points.
4. Do you take the train long distances, or do you prefer to fly? If you take the train, give yourself one point. If you fly, give yourself three points.

Now, add up your points. The maximum score is 12 points, and the minimum is 4. Most people will fall somewhere in between. Your score reflects your attitude toward risk and indicates your ability to accept or tolerate risk. Those of you with a higher score can accept a relatively great amount of risk and are referred to as risk tolerant. On the other end of the spectrum, those of you who scored low can accept very little risk and are referred to as risk averse. Many people fall in between the two ends of the spectrum.

Note: This quiz is not scientifically based–it’s being used only to illustrate a point. Quantifying risk tolerance is not an exact science. 

IMPORTANT DISCLOSURES
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

Before you can participate in the complex risk-management process, you need to have a general understanding of the concept of risk itself. In very broad terms, risk is the possibility of harm, injury, loss, danger, or destruction. Most risks come from someone or yourself. Risk can be further subdivided into two basic types: speculative risk and pure risk. Speculative risk has the potential for either gain or loss, much like the financial risks you assume when you put your money into certain investments. Pure risk, on the other hand, has no potential for gain; it can only result in loss or no loss. Most of the risks to which you are exposed in your life are pure risks. An example would be the risk of an accident each time you drive your car. The worst possible outcome is that you will be involved in an accident, while the best-case scenario is simply that you will have an uneventful, accident-free trip.

All pure risks exist because of various dangers known as perils. Perils are the actual, direct causes of loss and include death, disability, illness, fire, theft, and accident, among other things. In contrast, hazards are acts or conditions that could increase either the severity of a loss or the chances of a loss happening in the first place. A simple example will illustrate the distinction between a risk and a hazard:

Ex) Say you leave a cigarette burning in your living room. It falls to the floor, the rug catches fire, and your house (along with all the property in it) goes up in flames. Fire was the peril that directly caused the loss in this case, while the unattended cigarette was the hazard that increased the likelihood of a fire occurring

IMPORTANT DISCLOSURES
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

Strong financial foundation

Before you begin investing, you need to secure a strong financial foundation. Be sure these basic steps have been taken:

• Create a “rainy day” reserve: Set aside enough cash to get you through an unexpected period of illness or unemployment–two months’ worth of living expenses is generally recommended. Put the cash in a relatively stable and liquid investment that can earn money but still lets you access the funds easily.
• Pay off your debts: It makes more sense to pay off high-interest-rate debt (e.g., credit card debt) than to put money into investments that involve an uncertain return.
• Get insured: Having adequate insurance is your best protection against financial loss, so review your home, auto, health, disability, life, and other policies, and increase your coverage, if needed.
• Tax-deferred retirement plan: Putting money in these accounts defers income taxes, leaving you more money to put toward your financial goals. Take full advantage of them if they are available to you

IMPORTANT DISCLOSURES
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

If you’re fortunate enough to have money left over after paying the costs of living, you may be able to make that extra money go to work for you by investing it to earn a financial return. Investment planning involves deciding how best to put your money–your capital–to work to achieve your financial goals.

IMPORTANT DISCLOSURES
These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable — we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.