Money and Finance
It got me thinking for quite some time, if you are a budding investor but your significant other isn't interested or knowledgeable about it, what should you do?
Maybe your boyfriend is not aware that you have an existing portfolio. Or your wife is focused on her day-to-day life and not willing to take the risks.
Or let us even assume that both you and your partner have seen the benefits and risks of being invested and chosen to invest together.
What then? Should you invest together? Or have your own separate portfolios?
Let us first talk about the various benefits of investing as a couple.
1. Having more capital / dividends
This is the first benefit. When you invest together as a couple, you are able to invest in more shares from the beginning as your purchasing power is doubled. For example maybe you have $2,000 and your partner has $2,000. I'm sure you'll agree that $4,000 can buy more than what $2,000 can. Therefore a higher amount of shares owned will result in a increased amount of dividends as well.
2. Incurring less Commissions/Expenses
Depending on your broker, buying from one account would result in lower expenses overall compared to two separate accounts.
3. Closer Relationship (?)
Notice the (?). This depends on your relationship status. For example, it could work out if both of you have the same strategy, mindset and goals. In this case, it would potentially bring you closer as you plan strategies together. It may give off the impression and satisfaction that you're working as a "team".
There are some of the various benefits that I can think off. But unfortunately, I can think of more negative consequences when deciding to invest together as a couple.
CONFLICTS, CONFLICTS, CONFLICTS.
Maybe you're more aggressive, willing to take higher risks for higher returns. But your partner is more conservative. Therefore this may result in conflict along the way.
Or maybe you're happy with your portfolio. Even in bear markets you're okay with seeing your investments decrease in value knowing you're in this for the long term. But your partner freaks and wants to sell off everything to minimise losses. Conflict.
Investing styles are mostly dependent on your personality as a whole. Therefore expecting your partner to adapt to your style may not be the best way. Nor should your partner expect you to comply with his/her styles no matter what. Conflict.
You're a person focused with saving and investing. She's more obsessed with buying the latest handbag. Arguments about how much each person should contribute to your investment fund may result in negative consequences. Or you're a person that believes in saving regularly. Your husband prefers to spend his cash on booze and socialising. Again, conflict.
Notice that most of these problems stems from incompatibility as a couple. Your thinking may be different from one another and this would not help. A couple should understand each other's fears and work towards a common goal. Taking the lead is not wrong, completely deciding the direction of the portfolio and investments is not wrong either.
I guess what I'm trying to say there's no right or wrong answer here. It all lies in your common understanding as a couple.
It's all about whether they have agreed on a common goal and both are equally aware of what direction they are heading towards to.
So would it better to invest alone or as a couple? The answer is up to you to decide. Only you and your partner will know what's best for the both of you.
Signing off,
Teenage Investor
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Money and Finance
Is It Better To Invest Alone or as a Couple?
It got me thinking for quite some time, if you are a budding investor but your significant other isn't interested or knowledgeable about it, what should you do?
Maybe your boyfriend is not aware that you have an existing portfolio. Or your wife is focused on her day-to-day life and not willing to take the risks.
Or let us even assume that both you and your partner have seen the benefits and risks of being invested and chosen to invest together.
What then? Should you invest together? Or have your own separate portfolios?
Let us first talk about the various benefits of investing as a couple.
1. Having more capital / dividends
This is the first benefit. When you invest together as a couple, you are able to invest in more shares from the beginning as your purchasing power is doubled. For example maybe you have $2,000 and your partner has $2,000. I'm sure you'll agree that $4,000 can buy more than what $2,000 can. Therefore a higher amount of shares owned will result in a increased amount of dividends as well.
2. Incurring less Commissions/Expenses
Depending on your broker, buying from one account would result in lower expenses overall compared to two separate accounts.
3. Closer Relationship (?)
Notice the (?). This depends on your relationship status. For example, it could work out if both of you have the same strategy, mindset and goals. In this case, it would potentially bring you closer as you plan strategies together. It may give off the impression and satisfaction that you're working as a "team".
There are some of the various benefits that I can think off. But unfortunately, I can think of more negative consequences when deciding to invest together as a couple.
CONFLICTS, CONFLICTS, CONFLICTS.
Maybe you're more aggressive, willing to take higher risks for higher returns. But your partner is more conservative. Therefore this may result in conflict along the way.
Or maybe you're happy with your portfolio. Even in bear markets you're okay with seeing your investments decrease in value knowing you're in this for the long term. But your partner freaks and wants to sell off everything to minimise losses. Conflict.
Investing styles are mostly dependent on your personality as a whole. Therefore expecting your partner to adapt to your style may not be the best way. Nor should your partner expect you to comply with his/her styles no matter what. Conflict.
You're a person focused with saving and investing. She's more obsessed with buying the latest handbag. Arguments about how much each person should contribute to your investment fund may result in negative consequences. Or you're a person that believes in saving regularly. Your husband prefers to spend his cash on booze and socialising. Again, conflict.
Notice that most of these problems stems from incompatibility as a couple. Your thinking may be different from one another and this would not help. A couple should understand each other's fears and work towards a common goal. Taking the lead is not wrong, completely deciding the direction of the portfolio and investments is not wrong either.
I guess what I'm trying to say there's no right or wrong answer here. It all lies in your common understanding as a couple.
It's all about whether they have agreed on a common goal and both are equally aware of what direction they are heading towards to.
So would it better to invest alone or as a couple? The answer is up to you to decide. Only you and your partner will know what's best for the both of you.
Signing off,
Teenage Investor
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Hi Everyone, Hope you all have had a nice couple of weeks. I have been incredibly busy with work and as such, haven’t had much time to write. With July 4th write around the corner, we are over half way through 2014 and the year is just flying...
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Hello everyone, it's been quite some time since my last post. Have been catching up with my studies, going for army check-ups and everything else that goes on in a life of a polytechnic student. I recently received an email from Hady, who found...
- My 10 Year Plan
I never expected myself to sit down one day and start thinking and setting expectations and goals for my 10 year plan. I guess, it's the sort of thing that happens to a person just as he is about to complete another chapter in his life. I don't...
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Hi, welcome to Part 2 of How to Invest In Shares :) Hopefully, Part 1 was relatively beneficial with around 200+ views so far. Well, today I would be touching more on the returns of Investing! Why do we want to invest in shares? Because historically,...
- Investing In Actively Managed Funds
I've been reading a couple of Finance blogs mostly by Singaporeans, and I noticed that one of them (name shall not be mentioned) has chosen to invest with OCBC Blue Chip Investment Plan (BCIP) I did also talk about OCBC BCIP on a previous blogpost, http://teenageinvesting.blogspot.sg/2014/08/the-beginning-of-your-investment.html...