The Psychology of Risk-Taking in Everyday Life

Getting the most from life means taking the occasional risk. But human beings are not always good at judging risk, especially when those risks stem from the modern world. Our brains evolved to cope with life in a hunter-gatherer society, and so the risks presented by the modern world aren’t always easy to assess.

It’s worth taking a step back and assessing why we take certain risks, and how we can be objective before we decide to do so.

What Drives Humans to Take Risks?

The psychology of risk is complex. Many of the behaviours we consider ‘risky’ are processed in different parts of the brain, which makes it difficult to come up with a grand theory which explains all of them.

In adolescence, we might take risks in order to push boundaries, and explore what’s possible. Only by doing this can we learn how the world really works. In some cases, we’re driven to take risks by our state of mind – which might have been addled by the consumption of drugs and alcohol.

Not all risks, however, are unwise. For example, a professional opportunity might arise that offers a substantial reward, at the risk of embarrassment and failure. When a person is too risk-averse, they might miss out on easy wins. In other words, often the riskiest approach to life is to take no risks at all.

Personality Types and Risk Appetite

Certain kinds of people are more prone to risky behaviour than others. You might think of younger men, who are more likely to drive recklessly, and are thus over-represented in car accident statistics.

More impulsive people are likely to be more tolerant of risk, as they might lack the ability to stop and think. If you’re susceptible to peer pressure, than social considerations might push you toward a potentially unwise decision.

The Fine Line Between Brave and Reckless

Of course, risk also often comes with a moral dimension. We use terms like ‘brave’ and ‘reckless’ to make a distinction between laudable kinds of risk, and objectionable kinds. This usually relates to where the costs and benefits are going to land. To run into a burning building in order to save a vulnerable person is heroic, because the risk-taker bears the potential cost, but receives little benefit. A person who drives dangerously might be viewed as reckless, because they enjoy the benefit, while the potential costs could be felt by others.

Gambling and Other Controlled Risk Environments

Taking risk can light up parts of the brain that deal with reward-seeking. This is the basis of recreational gambling.

Every roll of the dice, spin of a wheel, or deal of a card, can release neurotransmitters like dopamine. Digital versions of popular games, like top slot games played online, can be particularly compelling.

Note that it’s not the actual reward that’s compulsive in this situation, but risk itself.

Everyday Risks You Might Not Notice

Risk-taking is something that we do so often that we don’t notice it. In a sense, even the avoidance of risk can be viewed as a risk, because of the opportunity costs involved. If you invest money in an ISA, then you’re putting it at risk. If you keep it in your current account, or in a pile of cash in your home, then you’re putting it at a different kind of risk.

A decision to drive while tired, or with a windscreen that’s partially iced-over, can be risky. Leaving clutter around a busy workplace can increase the risk of a trip or fall. Going for a jog without warming up can increase the risk of a strain. All of these risks can be managed – but only if they’re considered in the first place.