Investing With a Spouse

By Malcolm Berko

June 20, 2018 5 min read

Dear Mr. Berko: Since we sold our business and retired 11 years ago, our $768,000 individual retirement account has averaged 8.8 percent, including dividends. I'm proud of this performance because I manage the account. Some years were better than others, but we have been able to take out over $60,000 a year from our IRA without touching the original $728,000 in principal. We hope to leave the principal to our two children. We have Social Security plus another income source, so we are financially comfortable.

The problem is that my wife keeps telling me what to buy and what to sell. I resent her intrusion. She says we could do better if I took some of her advice. She thinks I'm too fixated on "male investments," such as defense, tech, e-commerce, insurance and construction stocks. We both read your column and respect your advice.

Because I've earned a good 8.8 percent for 11 years, I think my wife ought to leave well enough alone and stay away from this money. Should I allow my wife to influence and co-manage our stock selections? We'll accept your response. — TR, Punta Gorda, Fla.

Dear TR: No! Never. Absolutely not.

Let me tell you about my experience. For some time, my wife had a bee in her bonnet, demanding that I consider her personal input and that we co-manage our joint account. I argued ineffectively. (I made the mistake of marrying a woman who is smarter than I.) We worked OK together for nearly a year and made joint decisions on buy and sell transactions after perusing numerous research reports and newsletters. But because we're both stubborn and opinionated people (and there was ego involved), it was becoming increasingly difficult to make investment decisions together and compromise. So in early 2010, realizing that the Force was with her and my resistance was futile, we moved half the value of our joint account to another discount brokerage, which became her half. I would have zero input on her half. She would have unfettered access to portfolio decisions without consulting me. It made for queer dynamics. Because I benefited from that account, I wanted her to do well, yet because my male ego was involved, I didn't want her to do well so I could say, "See? I told you so."

In early 2010, I had Boeing, Lockheed Martin, Harris, Merck, Amphenol, Texas Instruments and other macho issues on my mind. After a month, I began to chuckle when I saw confirmation notices in our mailbox with such names as Ulta Beauty, Children's Place, Mohawk Industries, Bassett Furniture, TJX Cos. and Ross Stores. It didn't take me too long to realize that a woman's perspective on the stock market exposed me to investment opportunities that I'd have dismissed in the past. Ulta Beauty sells cosmetics and beauty supplies. She bought ULTA at $24, and it now trades for $253. Children's Place retails children's accessories. She bought PLCE at $34, and it now trades at $131. Mohawk Industries is a flooring manufacturer. She bought MHK at $44, and it's now $210. We still own each of them. Yep, there are some losses, but holy moly mama mia, during the past eight years, the account managed by my wife has done better than the account managed by me!

Under Florida law, your spouse is entitled to half of your IRA. So I recommend that you split your $768,000 IRA into two $384,000 IRAs. Move one of those half accounts to another stockbroker, and tell your wife to have at it. My experience has taught me two things: 1) Most women are smarter than most men. 2) It's easier to get older than wiser. Send me an email in a couple of years and let me know how you two are doing.

Please address your financial questions to Malcolm Berko, P.O. Box 8303, Largo, FL 33775, or email him at [email protected] To find out more about Malcolm Berko and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

Photo credit: at Pixabay

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