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Portfolio > Investment VIPs

What is your tolerance for risk?

By thinkadvisor

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When I was younger I did all kinds of risky things. I should be dead several times over, but I’m still here for some reason. When it comes to investing, I often wonder what other people are thinking. Like with the real estate debacle. I could see that coming. I mean, prices in our area quadrupled in 10 years. That just wasn’t sustainable, and yet people were signing up for those risky mortgages like there was no tomorrow. So, now I guess I would say I take appropriate risks financially, but not stupid ones. There’s a fine line between being brave and being stupid.
Ron, 60, Milpitas, Calif.

It’s pretty high. I have always been a bit of a rebel, zigging when other people zag, that sort of thing. And it’s paid off for me most of the time, especially in my business. Now that I’m a little older, I have mellowed somewhat. I still get nervous when I hear my caddie talking about a great new investment, though. That’s usually when I start thinking about getting out.
Ian, 62, Greenwood Village, Colo.

Oh, I don’t like risk. There are too many safe ways of investing to do anything reckless. My father was a butcher in St. Paul. He lost everything in an investment scheme with his brother-in-law. We were left with nothing and had to move in with some cousins until we could get back on our feet. I’m sure that scarred me because I have always wanted to take the safest route with my money. There are just too many pitfalls and dishonest people around. Just look at what happened with that man in New York…Madoff. No, I prefer not to give my money to swindlers, thank you.
Pamela, 66, Bloomington, Minn.

I would say I take a measured approach to risk. I allocate a certain percentage of my portfolio to what I consider riskier investments, growth stocks and the like. But the lion’s share of it is in safe-money investments, CDs and what have you. My wife has been bugging me to retire for some time now, but I keep thinking “just one more year,” and part of that is because I want to hedge my bets once I do retire. I have a buddy who retired pretty young—54. Then the market tanked and he’s been trying to find a job in this recession. I don’t envy him!
Steve, 63, Clearwater, Fla.

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