Just as the finance rule "a dollar today is worth more than a dollar tomorrow" has many axioms, the rule "a safe dollar is worth more than a risky dollar" is full of meaning. The idea generally is that the safer your dollars are, the more they are worth; the riskier your dollar, the less they're worth.

What is a risky dollar? Let's say you have two investments. One is in a t-bill and another is a share of stock in a company. The t-bill will get paid with a high degree of certainty. It is said to be risk-free (and barring civil war or alien attack, certainly seems secure).

The stock you hold in a company, however, is not risk-free. A company can go bankrupt, a company's value can go down. It is risky business being in business. So, a dollar in a t-bill is more certain to get paid than a dollar in a company.

But, why do people hold stock in companies? Why not be risk-free? Ignoring inflation for the moment, the potential that a t-bill will pay you more than it's supposed to is nil. While the investment is risk-free, it's also capped. An investment in a company, however, is not capped. While a company can go downhill, it can also appreciate considerably. The value of your share in a company can span from $0 to $1,000,000 (in some rare cases, no warranties, guarantees, etc.), although the probability of good things or bad things happening depends on a variety of factors.

How to WOG this rule into other realms? One easy example is to look at one's career this way.

A friend of mine has had a steady career, slowing moving up the corporate ladder by being relatively risk-free (at work mind you). His career progress is like a t-bill. It doesn't grow fast, but it grows steadily over time. As long as his employer continues to employ people, he's bound to inch his way up the corporate ladder one rung at a time.

Another friend has done quite the opposite. Taking chances, moving from one city to another, burning and building bridges with abandon, her career has been stellar, leaps above my corporate rung climber friend mentioned above, but, she's also been at the bottom of the ladder more than a few times.

There's all sorts of outcomes with either approach, but we'll cover than soon enough in Decision Sciences. Steady, risk averse progress is fine for some people. Others need more excitement, drama, or progress to fulfill their ambition. There's a balance between the two.

Some proverbs on the topic include:

"More risk, more reward"
"More risk, more risk"
"Loose lips sink ships"
"A ship is safe in a harbor, but that is not what ships are built for"
"Eagles may soar, but weasels don't get sucked into jet engines"

(if you're the owner of one of these, please let me know and I'll attribute your work)