How many of us actually grow up to become the things we dreamed about?

For me, I wanted to be in a famous rock band, but I only made it as far as my high school talent show stage.

Like most average kids, I was raised to follow the same old cookie-cutter path:

• Get good grades.
• Major in a “respectable” field.
• Land a stable job.
• Start a family.

The list goes on and on and on.

But it didn’t work for me. Instead:

• I didn’t care about doing well in school.
• I dropped out of computer science to major in arts.
• I work in a field that just went through massive layoffs.
• I don’t want to have kids.

So why do we tell the youth to dream big when in the end, life kicks us all in the butt?

Challenging the traditional mindset

When it comes to investing for the future, we’ve all heard the timeless advice:

• Save 20% of your income.
• Diversify your investments with index funds.
• Work until you’re 65.
• Retire comfortably until you die.

It's the path we're supposed to follow, right?

Sure, the historical average inflation-adjusted return of the stock market might be around 8%. Contributing $10,000 a year will get you to seven figures in 30 years.

For some, that’s a great life.

But I started to wonder,

I spend half of my waking hours at work and the other half keeping myself alive. If I’m lucky, I’ll get to do something fun once in a while.

Is this all there is to life?

I just need to keep this up for 30 more years and then I can cash out with a few million in the bank… if I’m still alive.

But where’s the spice? I’m not talking about going on a trip once a year or “living it up” on the weekend. If I'm going to be on this treadmill for another 30 years, I want more than just an average life.

"But Eric, if you don't invest in index funds, you could be risking your financial future!"

Am I gambling my life away?

You might be thinking, without a safety net, I could very well be gambling my life away.

But I’m not talking about betting all my money on black. At least not without a contingency plan.

Let’s look at two scenarios.

Scenario A: Work

1. I save up three years of living expenses.
2. I quit my 9-to-5 job to pursue a business idea.
3. I work on growing the business for the next three years.

Best case:

• The business generates enough revenue to continue growing.
• I work on what I want to.
• I sell the business and accelerate my net worth.

Worst case:

• The business fails and I go back to working a 9-to-5.
• I have a new experience on my resumé.
• I try again with a new business idea once I replenish my savings.

Scenario B: Investing

1. I look for companies that have growth potential.
2. I conduct fundamental analysis on those companies to decide which ones are worth the risk-reward.
3. I funnel all my money into those individual stocks for the next three years.

Best case:

• My investments multiply and I’m able to retire early.

Worst case:

• I lose a majority of my principal.
• I’m set back three years of savings and compounding growth.
• I have to work past the traditional retirement age.

Without risk, there’s no reward.

In both scenarios, there is risk involved. But even in the worst-case scenarios, the risk doesn’t seem that bad.

Maybe I’m missing something, but think about it.

People risk their lives every day.

• There is a financial risk in opening a small business.
• There is a reputational risk in posting on social media.
• There is even a safety risk in driving down the street.

The amount of risk involved might be different, but it’s still there.

Similarly, there is an opportunity risk in investing in index funds.

What if the market doesn’t return 8% for the next 30 years? Then everyone betting on index funds will end up disappointed and chained to their jobs.

Even a “stable” 9-to-5 job comes with income risk.

I could get laid off without a moment’s notice and be left with no income. I could mitigate this risk by diversifying my income streams, but I’ll save that for another article.

Risk is not one-size-fits-all

What you might think is “crazy” can feel totally rational for someone else.

In the same way, one person might tolerate a messy kitchen, but another has to do the dishes right away.

We all perceive risk differently.

Without this mindset, we wouldn’t have famous movie stars, pro athletes, or big tech companies.

There would be no Elon Musk or Mark Cuban.

We would all just be a bunch of walking robots like Stormtroopers.

What does your future look like?

It’s easy to find ourselves following the “safe” path only to live an average life.

For me, that’s a risk I'm unwilling to take.

I’ll gladly face the consequences of my decisions, whatever they may be. But I find it much harder to accept a future that was outlined by someone else.

And that’s why, to me, investing solely in index funds feels like gambling my life away because the average life is almost guaranteed.

Action of the day

Reflect on the path that you’ve taken and your feelings towards it.

• Are you holding yourself back from taking risks?
• Are you content living an average life?
• Would you be willing to take a risk for a chance at an extraordinary life?

No one wants to look back when they’re 80 and regret the things they were too afraid to do.

I may have given up on becoming a rock star, but I won’t give up on doing the things that matter to me, and that includes living life the way I want to live it.