By Yvonne Catton
June is a popular month for weddings. If you’re getting married this month, you have a lot to think about, but after the wedding — well, you’ll have even more to think about. And one of those topics should be your investment strategy. In these days of economic uncertainty, it’s important that you and your spouse make investment decisions today that will help you reach your long-term goals.
Of course, the investment process can seem confusing to just one person, so you might think it will be twice as difficult for the two of you. But that’s not necessarily so. You can launch an investment strategy that can serve you well throughout your lives together by following these few basic steps:
•Identify your goals. When you start out, you may have short-term goals, such as saving enough for a down payment on a house. As you move through the years, your goals will become longer-term in nature. For example, if you have children, you might set a goal of helping them pay for college.
And you will need to establish a goal of saving for retirement. Your first step toward achieving all these goals is identifying them.
•Commit to regular investing. When you begin your careers, you and your spouse may not have a lot of disposable income, but you still need to commit yourselves to putting aside some money each month — even if it’s only a small amount — for investment purposes. If you each have an employer-sponsored retirement plan, such as a 401(k) plan, contribute as much as you can afford.
•Reconcile your investment styles. You and your spouse may have different orientations toward investing. By nature, you might be an aggressive investor, while your spouse could be more conservative, or vice versa. This divergence does not have to be a problem, but you should communicate your preferences clearly to each other when choosing investments together. If you and your spouse each compromise a bit, you can come up with a joint portfolio that works for both of you.
At the same time, when you each have an account, such as a 401(k), you may not want them to look alike by containing duplicate investments. Instead, consider building portfolios that complement each other and that can help fill in any gaps that exist in your joint investment strategy.
•Be co-managers. You probably know many married couples in which one spouse handles all the finances and investments. This isn’t necessarily a good model to follow. You and your spouse will benefit if you both are familiar with your investment situation and capable of making decisions. Nobody knows what the future will hold, and if one spouse suddenly finds himself or herself in charge of the family finances, with no preparation, it can lead to troubles.
By following these suggestions, you can make long-term investing a rewarding part of your marriage. And the sooner you get started, the greater those rewards can be.
Financial adviser Yvonne Catton’s Edward Jones office is at 850 Main St., Suite 104, in Ramona. She may be contacted at 760-789-2804.