Sensible risk-taking isn't just important in the financial world; risk traverses all industries. And no one can break down the importance of knowing when to hold 'em and when to fold 'em like Karen Firestone.

That's why I support this woman's work.

Karen Firestone is the CEO of Aureus Asset Management, an investment firm she co-founded. The company is dedicated to providing contemporary asset management to families and individuals. Firestone is the author of "Even the Odds: Sensible Risk-Taking in Business, Investing, and Life." She received a Bachelor of Arts in economics from Harvard College in 1977, graduating magna cum laude, and a Master of Business Administration from Harvard Business School.

1) How does risk-taking factor into our everyday lives?

We experience risk every day, often imperceptibly. When we nudge a car too far out into traffic, forget to check if we locked the back door when leaving for work, interrupt a colleague speaking during a meeting or agree to invest in a friend's new restaurant, we are taking risks. The range of outcomes varies from almost imperceptible to losing valuables in our home, our life, antagonizing people at the office and a lot of money.

2) What is key to taking sensible risks?

I have identified four tenets of sensible risk-taking. They are right sizing, right timing, relying on knowledge and experience, and remaining skeptical of promises and projections. We should take the time, particularly with big decisions, to review and analyze the cases confronting us according to these parameters.

3) When is it best to risk money? When is it worst?

We should never risk more than we can afford to lose. If losing that money will severely impact our lifestyle, assuming that we have one that we wish to preserve, it's best to rethink the size of the bet.

Assuming that we're comfortable with the size of the investment we're making, it depends on how well we understand the nature of the business, company or investment in which we are spending the money. The more understanding we have the better. When the money is being spent on something about which we have a high degree of knowledge and confidence, we have a better sense of what that's worth and can evaluate whether we are paying a fair price.

It's worst to risk money in something about which we have no understanding, with a wildly optimistic forecast, when we are told in advance that we have no chance to get our money back for many years. (Some people call that speculation, but others call it venture capital.)

4) What happens when risk goes wrong?

Anything from a cold (if you go running assuming it won't rain and it's a very cold, wet downpour) to financial loss, a lost marriage or worse. Business, political, diplomatic and legal risk-taking pervade society at a high level, and individual risks surround us all the time. On a very sad level, almost everyone who dies of a heroin overdose has no immediate interest in killing himself, but the unreliability in quantity and strength of street-bought heroin means that unintended suicide is a possibility due to the risk of each dose.

5) Does risk grow with age, or is it just fear?

I don't think that risks grow, but often we feel that we have more at stake, so we have heightened caution about taking chances. On the other hand, there are many people who become more likely to take risks but don't even realize they are doing so. For example, I have a friend who was so worried about the stock market in 2008 that he withdrew all his retirement assets after the collapse and bought gold bars, which he was sure were much safer. They have since declined 35 percent in value, and the stock market has appreciated over 200 percent.

Randi Zuckerberg is the founder of Zuckerberg Media, a best-selling author and the host of a weekly business show on SiriusXM, "Dot Complicated." To find out more about Randi Zuckerberg and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate webpage at www.creators.com.