How to Be a Better Risk-Taker

A pair of skydivers during freefall above the clouds. A river meanders in the distance.

Here’s the thing about the people who take the biggest risks—they’re actually the best planners.

“Because of their consistent and often intense training, successful risk-takers are prepared for any contingency,” writes author Kayt Sukel in her new book, The Art of Risk: The New Science of Courage, Caution and Chance.

Sukel learned this after speaking with rock climbers, BASE jumpers (BASE is an acronym for Building, Antenna, Span and Earth—fixed objects from which one can jump), professional poker players, entrepreneurs, firefighters, U.S. Army Special Forces operators and brain surgeons while she was on a mission to understand why people take risks and how we can approach risk smarter.

In the process, she learned that most people can’t even define risk, let alone intelligently prepare for it. “Risk,” she says, “isn’t gambling, extreme sports, junk bonds, or unprotected sex—though, certainly, those activities have elements of risk to them. Rather, risk is simply a decision, or behavior, that has a significant probability of resulting in a negative outcome. That’s it.”

In other words, we’re all risk managers, whether we’re deciding what to eat for breakfast, who to date, when to start studying for that exam or how much sunscreen to apply. Professional risk managers simply get to do these things for a living, working to optimize the upside and minimize the downside of risks for companies and organizations.

Most people think that the most daring people—like those interviewed in The Art of Risk—are fearless and reckless. But that’s only true to a limited extent.

Our appetite for risk is influenced by many factors, age being a major one. It shouldn’t be surprising that young people are more eager to take bigger risks. But it’s not because young people are just more fun than older people. Neuroscientists at Cornell University have found that the brain actually processes risk differently for teenagers, in essence exaggerating the rewards of doing something dangerous. In their technical terms, “there is a heightened responsiveness to incentives and socioemotional contexts during this time, when impulse control is still relatively immature.”

That gets into the neuroscience of why anyone takes risks. We all rely on a bunch of different physiological systems, particularly the mesolimbic pathway, which is also referred to as the reward pathway. It’s a circuit of different brain regions that play a key role in our emotions, memory, judgments and desires.

Sukel calls this circuit a probability computer, “designed to help us process not only the potential and personally adjusted rewards that may await us if we make a particular decision but also the potential risks inherent to that choice—and, with luck, guide us to the best judgment for the situation at hand.”

As we get older and our brains fully develop, we get more skilled at calculating risk. And the people who take the biggest risks become the best risk calculators. As the folks at Fast Company put it, “risk-takers are more nerds than superheroes.”

Ultimately, Sukel identifies four lessons to help us become better risk-takers.

1. Reset your definition of risk

Risk is ordinary. It’s ingrained in everything we do. It’s neither bad (that is, something that’s dangerous and should be avoided) nor good (that is, something that’s macho or glorious). Risk-taking is necessary, and we should acknowledge the risk in every decision we make. By doing that, we can consciously explore alternatives in order to maximize the potential of every decision.

2. Know what you can't change

Everyone’s reward pathway operates a little differently, meaning some people are more apt to accept danger and uncertainty, while others tend toward the safer routes. This is a genetic baseline of risk-taking behavior you can’t change. Having a self-awareness of where your baseline is can help you figure out whether you’re pushing too far or you need to push a little further. 

3. Know what you can change

Successful risk-takers are planners. As one researcher told Sukel, “We often talk about impulsivity and risk-taking in the same breath. But they are clearly different. . . .  It’s likely that the successful risk-taker is taking risks that help him move toward a long-term goal, whereas the dysfunctional risk-taker is only looking at immediate outcomes.” Don’t be a dysfunctional risk-taker. Be a risk manager and plan ahead.

4. Take the leap

We should take more risks, but that doesn’t mean we should start jumping out of planes. Happy, healthy, clever risk-taking doesn’t have to be extreme. It can be trying a new restaurant, traveling somewhere different or taking up a new hobby. Risk-taking is all about learning, adapting and growing. It’s time we look forward to taking a few more risks in our lives.

To learn more about managing risk as a profession, check out our article on risk managers. Want to learn more about risk? Here are the colleges where you can major in risk management and insurance.