Skip to main content
youngmoneyadviser q&a

Darryl Brown, investment planner and founder of You&Yours Financial in Toronto.Handout/Handout

Question from a Globe and Mail reader: “My husband and I have very different risk tolerances when it comes to investing. His family lost a lot of money in the 2008 financial crisis and as a result, he is very conservative with his investing approach. He has almost $100,000 invested in a high interest savings account which I don’t think is an efficient strategy. Whenever I bring up the topic of investing, we fight. Do you have any tips on how to approach the subject with him?”

Answer from Darryl Brown, an independent investment consultant and founder of You&Yours Financial in Toronto: Your husband sounds a lot like my partner. Though for different reasons, she, like your husband, doesn’t tolerate financial risk well at all. Even though I am a professional investment consultant, this wasn’t an easy gap for us to bridge. Money in relationships is never straightforward. And, like all things in relationships, there is no “right” way to do things.

The decision to invest is a combination of two things: ability – do you have the money – and willingness to actually do it. Willingness to invest always trumps ability, in my opinion. A person who is not willing to accept the risk that their money will fluctuate over time, should not be pressured into doing so. Too often, it leads to unsuccessful outcomes (i.e. panic selling when the markets go down).

In my previous post, I talked about the importance of creating an Investment Policy Statement (IPS) as the key to successful investing. For anyone investing their money, it is an incredibly important process to go through, even if you’ve been investing for years.

Young Money Advisor: I’ve been waiting for a market crash and accumulating cash. Should I invest now?

Creating an IPS as a couple takes a lot of consensus across objectives, timelines, risk, liquidity and more. Additionally, as with your husband, people can be significantly affected by both direct and observed experiences. For every person you hear boasting about their returns or successful investment strategy, there are 100 people who are too ashamed to share their cautionary tale.

So, how do you successfully approach investing with your significant other?

First, Listen.

Like, really listen. Take a walk through the respective experiences that affect how you feel about money in general. Think of it like financial therapy. Really dig into how you both feel and why. These can be challenging conversations, but they often reveal that a person’s attitude about money has very little to do with money.

Second, ask “Why?”

Lost in the day-to-day market commentary, which overwhelms most people, is the “why” we invest in the first place. If your basics are covered, meaning you have a good financial plan in place and an emergency fund, investing is the best way to meet your financial objectives. I think this is a simple sentiment but is often overlooked when folks get wrapped up in the jargon, highs and lows of investing and it can take on a nervous emotional energy.

Successful investing is not solely about making money. It’s about figuring out the life you want to live and what you need to get there. I encourage my clients to invest with intention. Intention means understanding why you are investing in the first place. Communicating and aligning on your goals sounds pretty basic but you’d be surprised how many couples don’t take the time and operate on assumptions.

Third, plan.

We all visualize that beach we want to retire on but going beyond the daydream to actually planning how you’ll get there really matters. Committing it to paper helps immensely. From there, investing simply becomes the mechanism by which you’ll achieve those goals, and the ebb and flow of the market and stock predictions become less central to success. When you look at investing as a way to live the life you want, it takes on a much more empowered energy. Suddenly the trees become a forest.

I don’t believe in a one-size-fits-all approach. A successful investment strategy should be reflective of the individual(s) investing. If you commit to the above steps together, I’m certain you and your husband will open an important dialogue about investing and find solutions that feel comfortable for you both.

Darryl Brown is an independent investment consultant and founder of You&Yours Financial in Toronto.

Are you a young person with a question for our adviser? Send it to us.

You can also join the Young Money Facebook group.