Saving Like A Pessimist - Deepstash

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Saving Like A Pessimist

If you are aware that 'black swan' events are not so unusual, you can plan if such an event happens. That is the benefit of a high savings rate - it is easier to overcome an unexpected obstacle.

But there are limits. If you lose a house to a wildfire, then you're not relying on short-term savings to recover but on the insurance company providing you with the coverage you paid for. However, pessimism gives you an awareness that bad things happen.

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MORE IDEAS FROM THE SAME ARTICLE

Mathematician John Littlewood explained the presence of miracles through statistics. Littlewood's Law says we can expect a miracle every month. On the flip side, we can expect a disaster also as often.

We're currently experiencing a series of sequencing risk more often tha...

Pessimism has its limits. When it comes to investing in your future, you should be an optimist. If people try to get better at solving the recessions, panics, and wars, the long-term odds are in an economy's favor.

For investing, it means that as long as you're moving forw...

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Robert Frost

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