The New Commonsense Guide to Your 401(k): Rebuilding Your Portfolio From The Bottom up

Chapter 42. What Risk?

LIFE IS ABOUT RISK. Creating the life you want for yourself requires risk taking. And it also requires saving. Try to think more broadly about risk in all parts of your life by taking this quiz:

1. You and your spouse are ready to have a child. Both spouses work, but the husband's company announces coming layoffs. You would. . .

   1. proceed full steam ahead; you're not getting any younger.

   2. figure that if the husband were to be laid off, he could perform child care duties while thinking about his next career move.

   3. put your family plans on hold for a year while the two of you get the lay of the land.

   4. reconsider having a family; life is too uncertain.

2. Your friend takes you to an early morning sale at a nearby clothing outlet. The prices are great, but you can't try anything on and you can't return anything. You. . .

   1. go for broke, buying five suits that you figure cost half what you would pay in a department store.

   2. Choose one $500 item. You saw the same piece of clothing for $1,000 and you're willing to bet that you can alter it if it doesn't fit.

   3. Buy a couple of low-priced items figuring that you'll just lose a little if they don't work out

   4. Spend two hours writing down sizes, prices, and brand names. You plan to go to the local department store and try these items on so that you can come back and buy them, knowing that they will fit.

3. After you make an investment you typically feel

   1. thrilled.

   2. satisfied.

   3. confused.

   4. regretful.

4. It's time to plan you vacation. You

   1. take off on a mystery tour ...