Heads up: When you and your spouse fight about where to buy your next house, you're not really fighting about where to buy your next house.
You're fighting about the money it will cost to get that house.
The same goes for that stainless steel refrigerator and the vacation to Majorca/Bermuda/Disney World.
I see it every day: Couples argue about money management, and this includes investing.
How couples choose to invest their money depends on their goals as a couple. Couples can invest together, then have individual savings and retirement accounts. For example, if you are normally a high-risk investor, you may not want to be so aggressive with your investing as a couple -- especially if your spouse is more conservative.
And that's just the beginning. Here are three tips that will help you invest wisely as a couple:
1. Opt to be more conservative.
When couples come to the bank to seek my financial planning advice, their levels of risk are usually not 100% compatible. There is always one spouse who wants to take more risk than the other, and this is the point in the relationship when one person has to compromise.
My advice to couples is always the same: Be more conservative. It’s better to have a lower rate of return on your couple’s investments than take the risk of an argument when you lose money on aggressive investments.
For example, my colleague Amy Calistri -- who writes StreetAuthority's 'Daily Paycheck' newsletter -- gets a dividend paycheck for every day of the year using her conservative approach. She averages $43.96 in dividends per day. And while that might not sound like a lot, I don't think anyone would complain if they were handed a $50 bill every day of the year.
2. Remember that 'joint' means 'together.'
Each spouse will have their own investment preference, but joint accounts mean that couples have to make their investment decisions together. Give a little and take a little, and be open to investment options that you normally wouldn’t choose.
Investing styles are a direct reflection of your personality, so your spouse’s preference for conservative or aggressive investments should be no surprise. Expecting your spouse to adapt to an investment style that they are not comfortable with can only lead to trouble. So be open to an investment discussion about your options for the sake of your portfolio -- and your relationship.
3. Make a commitment for the long term.
Marriage is (ideally) 'until death do you part,' and your investment strategies should be the same. Focusing only on the short term can send mixed signals to your spouse about your commitment to the relationship.
It’s good to set short-term goals because it gives you and your spouse something to look forward to, but setting long-term goals shows your spouse that you are committed to a long-term future together. Again, a dividend-focused strategy like the one in Amy Calistri's 'Daily Paycheck' newsletter than we talked about earlier can be a great choice.
When couples come to the bank to open joint accounts, I always ask them about both their goals as a couple as well as their individual goals. Think about yourself when considering the future -- don’t lose yourself in the couple.
The Investing Answer: If you want to stay on the same investing page as your spouse, you have to talk to him or her about your investment goals and strategies. The key to a relationship -- anything in a relationship, including investing -- is communication. If you and your spouse talk about your goals as a couple, then you can decide how to invest in a way that you are both comfortable with. Prioritizing your goals into short-, medium- and long-term time horizons will help you decide how you want to invest.