Even ycombinator does not fall for that, they invest in thousands of companies and they have a lot less to lose than many employees.
There is even a kind of natural balancing mechanism here, in the sense that the earlier you join a company, the more likely it will die quickly and free you to take another shot. So the riskier the equity you opt for, the more rolls of the dice you'll get.
When you're working at a company you'll have access to all sorts of insider information, which you could use to make some informed large bets.
Also note that at a startup "equity" usually really means "options on equity" (unless you're a founder), so you actually can work somewhere for a bit before deciding to take a position that might not be optimal from a diversification perspective.
How do you increase the value of an option? Increase the volatility. Continuing to minimize risk is not going to meaningfully change your lifestyle. Your call option already protects you on the downside, so you should try to blow it out on the upside, and take a risk.
You can also view your experience and skills (and the minimum salary it allows you to command in the market) as the same thing. After a certain point, try for something that will meaningfully change your lifestyle. Worst case, you can fall back to that floor salary.