I took the last week off writing to deal with some recent tough financial situations. No... not the major cryptomarket crash we have seen this last week or so, although the timing on that has not been kind either. This loss has nothing to do with cryptocurrency or Bitcoin, but another one of my ventures that lost big time ($27,000 to be exact) over the past weekend. Suffice to say, I am still dealing with the loss...
Everyone loses at some point in life. Even the ones you think never lose... they lose. Taking a loss at some point in life seems pretty inevitable. The question is how will you deal with that loss when it does hit you? Do you have a plan?
Planning For Loss
While I have been doing ok in the crypto world as of late, I have not been taking my own advice when it comes to my other investments. The #1 rule to investing is to NEVER invest what you can't stand to lose. All the money I have invested in cryptocurrency I have done so because I was 100% ok if I lost every penny of it. Investing is a gamble, plain and simple. It may be more of a calculated gamble then say roulette, but it is a gamble none the less. Even if you understand the golden rule and never invest what you can't stand to lose you should still have some sort of plan for what happens when you DO lose it all. While I have a few plans in place for my crypto investments, I did not, however, have a plan in place for a major loss in my other venture and now I am at a complete loss as to how I should handle it. Don't be like me, make a plan!
Make A Plan
I had no plan in place for a major loss and now I totally regret it. The risk I took was more then I could lose and that was really my first mistake. Looking back, even if I made a plan for this kind of loss, I am not sure how effective it would actually be even. In my case I broke the golden rule and invested more then I was comfortable losing. When it comes to any investment, if you stick to the golden rule and make a plan of attack if things DO go south, you are going to feel a lot better about yourself and your situation if that big loss does strike. I would even say that having multiple plans for dealing with your loss depending on different sets of circumstances would also be a wise practice. Making a plan is not easy, and I certainly don't have a "standard" solution that would work for all. Maybe your plan is to just take it on the chin or maybe it's to borrow from a family member. Perhaps you liquidate other assets or just plan go bankrupt. Whatever plan you make, the point is you are thinking about this scenario. No matter well laid your plans may be, no plan ever seems to go perfectly so you gotta stay agile and roll with the punches as the come in.
Still Gotta Roll With The Punches
So we know that we need a plan for dealing with a big loss, but what happens when that plan doesn't go as planned?? Damn good question... Most plans (from my personal experience), don't ever seem to go exactly as planned, and if this is your "contingency plan" you ask yourself "Now what?"
At this point (pretty much where I stand now), you just gotta roll with the punches and take the problems as they come and try to deal in the best way possible. It is now officially time to get creative and engage that critical thinking cap. Look for alternative solutions like perhaps a barter or settlement in another way (man-whoring anyone?? hehe). As each punch comes in do your best to dodge and weave, but ultimately if you are at this point you are most likely not going to escape the ordeal without a scar or two.
Taking It On The Chin... And The Gut, The Kidney, The Knee...
I broke the golden rule AND I also didn't have a plan to deal with that major loss. I have no choice but to suck it up and take a few punches to the chin and then try to recover. This is the point where the men are separated from the boys. The whales separated from the minnows. Do you get so beat up by the loss that you turn tail and run, or do you take the beating like a man and stand your ground bleeding from your wounds. A true test of manhood in our awkward modern society. Personally I know that I can bounce back from this even though it may be a very tough blown in many ways. I am Relentless...