Investing As A Couple: How To Invest With Different Risk Tolerances

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Figuring out the best way to invest can be a challenge as an individual, but it can really get complicated once you’re investing for you, your spouse and your family. Everyone is different, and that means some people have different levels of comfort when it comes to investing. Some people have a high tolerance for risk, while others prefer safer investments.

Nearly half of couples (47 percent) say they disagree about the amount of risk they’re comfortable taking with their investments, according to a 2024 Fidelity study. 

Here are five tips for investing if you and your spouse have different risk tolerances. 

1. Talk about your risk tolerance

Risk tolerance refers to your ability and willingness to take risk, and it’s important to understand what yours is before you start investing. Once you have a grasp of your own risk tolerance, you should make time to talk with your spouse about the similarities and differences in how you each view risk when it comes to investing. 

If you’re both on the same page when it comes to risk tolerance, developing an investment strategy will be a bit easier. If you have different risk tolerances, you may need to deviate from how you’d invest on your own.

2. Understand your financial goals as a couple

One of the first steps in developing any financial plan is to think about the goals you’re trying to achieve, both in the near-term and long-term. You may have short-term goals such as saving for a down payment on a house or buying a car, while long-term goals are often focused on retirement. 

Understanding your goals may actually make it easier to invest in a way that satisfies both you and your spouse’s risk tolerance. Money that will be used for short-term goals can be invested in safer assets such as money-market funds or certificates of deposit, while stocks are a better choice for long-term goals. 

3. Compromise

Compromise is an important part of any successful relationship, and it may be necessary when it comes to combining your risk tolerances as well. Just because you can tolerate major swings in the value of your investment portfolio doesn’t mean your spouse can. 

Volatility can have a major impact on the mental and physical health of a person, so you need to find the right balance of risk that allows you to meet your goals while also being able to sleep at night. If one of you is worried about your investments, you may need to lower the risk in your portfolio.

4. Align your investments with your goals

One way to compromise in combining two different risk tolerances is to align your investments with your overall goals. In fact, this is a sound strategy for anyone who is building their financial plan. 

Riskier investments like stocks or funds that hold stocks are a better fit for long-term goals such as retirement or saving for a young child’s education. These goals are often more than 10 years away, so you have time to recover from the inevitable volatility that comes with investing in stocks. 

Short-term goals should be matched with safer investments. Maybe you’re saving for a down payment on a house in a few years or are planning to buy a new car. Investments such as money-market funds, certificates of deposit or short-term bond funds can be a good fit for your near-term goals. You’ll get a return above what you’d earn in a bank account, but the money will also be there when you need it. 

Even if you and your spouse have different risk tolerances, you may each appreciate how different investments fit into your overall investment strategy.

5. Develop an overall investment strategy that you’re both comfortable with

You and your partner may find it helpful to work with a financial advisor who can help you develop an overall investment strategy. An advisor may also be able to help educate you on the risks associated with different investments, as well as the risks of not taking enough risk with your portfolio. 

An overall plan will consider your various goals and put together a plan that helps you achieve them. You’ll understand how much you’ll need to save and how well your investment returns need to be in order to get to where you want to go financially.

Bottom line

Navigating investing as a couple can be complicated, especially if you and your partner have differing risk tolerances. But practicing communication, planning and compromise can help set you up for financial success.