What strategy should be avoided according to the guideline of not risking more than one can afford to lose?

Investing all savings into risky assets goes against the guideline of not risking more than one can afford to lose. The fundamental principle here is to protect financial stability and ensure that when individuals decide to invest, they should only allocate funds that, if lost, would not jeopardize their overall financial health.

This strategy emphasizes the importance of maintaining a safety net and having sufficient funds for necessary expenses and emergencies. By risking the entirety of one's savings in high-risk investments, individuals expose themselves to the potential of significant financial loss, which could lead to detrimental consequences, including inability to cover living expenses or meet debt obligations.

In contrast, the other options focus on prudent financial practices, such as prioritizing insurance for major assets to shield against significant loss, comparing insurance options to find the most beneficial coverage, and shopping for competitive insurance prices to ensure cost-effectiveness. These strategies support risk management and financial security, aligning with the guideline of preserving one's financial well-being.