The Journey vs. the Destination

It’s the age-old dilemma: do you take the $100K now? Or risk it all to open a $1 million case that has a 10% chance of being there?

I have seen two philosophies or two ends of the spectrum in life.

Type-S – One side believes in the now. He/she may say things like, “What is fun to do now?”, “You only life once.” or “I can sleep when I’m dead.” It is present-focused and tends to be unconsciously swayed without mind to consequences. The decision-making can be classified as risky and rash but is advantage when needing to be assertive or act fast. This may be a thrill-seeker but prone to extreme heartache or deep depression. The gains can come in greater steps but they are less predictable and may or may never come. This, however, also means that when losses come they are equally steep.

Type-L – The other side believes in the distant future. He/she may say things like, “What will the world be like in 10 years?” or “How should I spend the rest of the week?” There is some direction and generally involves quite a bit of thinking and planning. The decision-making can be slow but is usually well thought out. He/she likes to get advice and make mostly conservative and less drastic changes in life. Certainty is a god here. Any guarantee that fails to live to its promise will corrupt any trust that was once held. Gains and losses are incremental and almost imperceptible but over time may be significant.

The “S” stands for short-term and the “L” stands for long-term. I got the idea from basic investing. Me? I take both approaches. Although I’d say I’m only 25% Type-S and 75% a Type-L. Most of my investments are long term but being young (and ignorant), risks are more fun and often not properly thought out.

NOW WHAT DOES THIS HAVE TO DO WITH ANYTHING???

Ok, understanding your type does have a purpose… just trust me. What this means is here: The Type-S will most likely care about the journey and the Type-L will most likely care about the destination. Now, let’s be clear, being rich is not a destination… it’s a desire. The destination would be a goal and something specific, like being rich from starting a business in a shoe shop in NYC. It’s tangible and could be someone’s dream. The journey is what things are like while trying to reach the destination. It’s strange because although I am more on the Type-L side, I see myself making many actions for the short-term payoff. Perhaps this says something about my dedication or the exactness of my destination. Not to undermine the Type-S, because the danger of the Type-L is to lose his/her vision of the destination and get caught up, so to speak, in something else. Here are typical scenarios for each type.

Type-S – Will take what is best now, and/or do what sounds good at the time.
Type-L – Is willing to work a near detestable job in order to save up for something else.

To give another illustration, when sorting through job offers, my primary concern was that combination of the work and the city had to be enjoyable. I knew that I was only guaranteed the now. Any promises that in several years being able to move somewhere didn’t mean much. There was no certainty in that unless I had it in a contract. Thus, my risk-taking was inhibited and I made the safe decision.

A few last things… (1) If played correctly, short-term investments may prove beneficial in the long-term, (2) one’s destination may change (3), people are different types in different aspects/stages of their life and (4) the people you are with affect your journey greatly. I would write more extensively about these but I feel that they are fairly axiomatic. If curious feel free to let me know.

In conclusion, as much as we try to classify and understand them, people are complicated beings. Let the complexity of the original question not be overlooked. One might expect a Type-S to take the $100K immediately and splurge. But he/she may also try for the million, being a risk-taker. Whereas the Type-L may like the certainty of the $100K, he/she may consider the fact that the overall payout odds are equal and how much more could be done by going for the million. Talk about unpredictable.

Note: Originally, I had intended to split this section into two. However, it was consolidated to "The Journey vs. the Destination" since the anticipated parts were ultimately both answered. "True Motivation" was covered in the 6/27 entry. And "Sacrificing the Present for the Future" was covered well here.