A 3 Question Algorithm for Risk Taking

I’m listening to The Top 10 Distinctions Between Millionaires and the Middle Class and here’s an awesome formula for taking risks it presents:

When deciding whether or not to take a risk on something, consider these 3 questions:

  1. What’s the best thing that could happen?
  2. What’s the worst thing that could happen?
  3. What’s most likely to happen?

If you can handle the worst outcome, and the most likely outcome brings you closer to fulfilling your goals: do it.

Otherwise, don’t.