TAKING CHANCES 1

Before taking a plunge into a significant change in your life (whether a career change, building a house, investing in a business, or buying stocks), you should consider your capacity for taking chances. You should, first of all, look into your income profile, i.e., what you are presently earning and your capability to grow your earnings in the future. Then, you should consider your age and your health –which modify your overall income profile.

The red area on the bar indicates a poor capacity to take chances, the green area an excellent capacity.

The income figures are benchmarks (where most American families are, in terms of annual income & net worth). Household income is the family gross income (e.g., if both spouses earn incomes), the disposable personal income is the take-home pay after personal income taxes, the net worth is the total of the family’s assets minus the liabilities (i.e., mortgage, loans, etc).

Income figures less than these benchmarks indicate a below-average capacity to take chances, while income figures more than these benchmarks are positive indicators to take chances. On the average, earning capacity is highest from the age 35 through 50, naturally declining with age.

data from http://www.bea.gov/briefrm/percapin.htm and http://www.businessweek.com/
graphics by Ren Garcia