If you’re down on your luck and doing badly, there’s a good chance that it is because you’ve overextended yourself, and taken on responsibilities and commitments that you can’t fulfil.
That’s why people like to lend money to people who already have lots, but hesitate to do anything to help someone who is on the verge of bankruptcy.
If I lend my car to a friend who has her own car (she just left it at a friend’s house or something), I knew that a car is a responsibility she’s familiar with and can handle. But if I lend it to someone who doesn’t own a car because life has dealt them so much misfortune that they can’t afford one, I’m not really doing them a favour. They need the car because they’ve committed to something they’re not equipped to do (an invitation they should have turned down, a job in another city, whatever it is), and are overextended.
To give them a resource like a car is essentially giving them another thing to worry about on top of the stuff they already can’t handle, and also enabling them to continue trying to meet their current commitments when it would be better to get rid of them. Obviously you can’t make people make better choices, but you can choose not to be part of making their problems worse – and choose not to put yourself at risk of their bad luck.
Another example is investment. Investing in a small business or startup is quite risky, but potentially very rewarding. You minimize the risk and maximize reward by choosing your investments carefully. Let’s look at two entrepreneurs: one has two years of living expenses saved up and three other investors who have committed enough cash between them to let the business owner create a prototype and pay sales staff for a year while they try to get traction. If you invest $10,000, they can afford to build a second prototype.
The second entrepreneur has already exhausted his savings in building a first prototype, but can’t afford to pay sales staff so he’s doing it himself. If you invest $10,000, he can afford to spend another 6 months trying to drum up sales OR pay staff for 3 months OR build a second prototype, but not all three of these things. The second guy is farther along and surely needs the money more, but the first guy is getting my investment.
I won’t speak as to whether any of the choices made by people in these examples are right or honourable, but it’s worth thinking about if you’re ever wondering why you can’t ever get a break. Maybe you’ve overextended yourself. Or maybe it’s something totally different. This is just an idea.
PS. This is the most Ayn Rand-esque thing I’ve ever written and it makes me feel kinda dirty. I stand by it though.