What To Do When Your Spouse Or Partner Doesn’t “Believe” In The Stock Market

The financial independence / early retirement community relies on several basic tenets in their quest for freedom from the “normal” lifestyle defined by working 9:00 a.m. to 5:00 p.m., Monday through Friday, until old age.  One of these golden rules for FIRE is that you need to invest 25 times your annual expenses in the stock market.  Upon reaching this milestone, you can then count on taking out 4% of your nest egg (representing average gains for the fund) to support you for the rest of your life.  The standard path to FIRE is not really an option for us, due to our sizable debt.  However, there’s another issue.  Mr. Smith doesn’t “believe” in the stock market.

Believe In The Stock Market


I can already predict the comments that will be on this post.  Yes, I’ve showed him the long-term charts that show steady increase in value once you average all of the tumultuous fluctuations.  He really just can’t trust stocks.  Mr. Smith is somewhat fixated on those “lost all our retirement savings in the recession” stories.  He says he doesn’t like the idea of all of your money “just being a number in a computer.”  Mr. Smith can be pretty old-fashioned at times (he still refuses to open a Facebook account).  I could see him getting along with old folks who keep money stored away in their mattress.  Ultimately, my husband likes tangible investments, he wants something he can hold.


What is a hopeful early-semi-retiree to do?  How can you achieve FIRE without the power of compound interest from investments?  The answer is to DIVERSIFY.  While Mr. Smith can’t come to terms with dumping everything we can save into the stock market, he’s not totally adverse to the idea that we could use it to make some money.  He likes the idea of having some security to fall back on, if our stock investments were to suddenly self-combust or be spirited away by a flying unicorn.  He was interested in learning more about REIT’s when we have more funds to allocated towards investments.


Our plan includes several different types of investments.  I have money going towards a traditional 401K through my employer, with the plan that we will not touch that until our sixties.  We also have one rental property right now and hope to add a second one in the future.  Mr. Smith loves the premise of rental properties.  He is very handy and likes to stay busy.  He loves the idea that his only real work will be limited to maintenance of a couple of rental properties.  Of course, we’re pretty behind on making any kind of investments because of our battle with debt, meaning that I will have to continue bringing in some type of part-time income after 2022.


How much do we plan to invest?  I’m not sure at this point.  Doing some very basic calculations with the 4% rule, I’d like to semi-retire at 40 with at least $100,000 in my 401K.  If I put in only an additional $1,000 every year for 25 years, at the age 65 the value will be $314,363 dollars.  Again using the 4% rule, we could withdraw $12,574 each year for living expenses.  I hope to have quite a bit more interest-earning investments, but these numbers provide a useful and encouraging benchmark.


Another essential component of FIRE is living a frugal lifestyle – when your living expenses are low, you don’t need to have as much invested.  In addition, there are other ways to “invest” in your future without buying stocks and bonds.  We hope to have a homestead with things like chickens and a vegetable garden to further reduce our cost of living.  I really appreciate the research that went into this post about solar panels.  It’s another idea on how to use our money to facilitate freedom in the future, without relying solely on a large nest egg of investments in index funds.


Ultimately, the issue isn’t whether Mr. Smith is right or wrong about the stock market, it’s about finding a financial plan that we’re both comfortable with and which will allow us to reach our goals.  Financial planning and investing, like most other decisions in a marriage, require input from both spouses.  And, you need to compromise.  There needs to be some give and take on the important stuff, instead of just having one person handing down directives.  The most important thing is that we have a common goal that has reshaped our lifestyle and priorities.  Diversification of our investments makes us both happy and will enable our escape in the near future.



    1. I accepted long ago that Mr. Smith will never be happy working an office job. Our dream for semi-independence is all about doing a little bit of work that we don’t mind and on flexible schedules. Property management will be perfect for him.

  1. That’s a really tough situation. I have a friend whose wife is really skeptical of the stock market, but I think it’s partially due to his placing massive bets on risky stocks and hoping they pan out. Not a good way to get a spouse on board!

  2. I have a question that I’m guessing many in the FIRE community would find naïve, but I’m gonna ask it anyway: isn’t having a 401K a bit like being in the stock market? I have my profession’s equivalent to a 401K and I get different amounts of return based on something–and I thought that something was the stock market. Can you tell me the basic differences between a 401K and being in the stock market?

    1. I’m still figuring this stuff out myself, but I believe that a 401K consists of investments in different funds, which are made up of a whole collection of stocks. It takes some of the volatility out of the equation, because you’re not just following the ups and downs of one particular stock.

      What you’re describing might be different – you might get shares in your company’s stock. It’s probably worth finding out.

      And, don’t ever be embarrassed to ask a question on this site. 🙂

  3. Kim from Philadelphia

    Perhaps index funds/mutual funds might be possible investment vehicles for money that’s not placed into your 401k.

    What’s most important here is the joint quest to eradicate debt, ward off lifestyle inflation, and pursue a lifestyle that meshes with your goals/beliefs.

    1. Yes! Much of our focus is on the debt right now, but we’re committed to a joint goal and will figure it out as we go. There will come a time when Mr. Smith and I can discuss other investment options – index/mutual funds are definitely something to be considered.

  4. This isn’t a bad idea – to diversify. I actually use a variety of investments (stocks, P2P lending, eREIT’s, etc) – which you can read about in the “Investments” section of my website. By diversifying, you protect yourself from a lot of risk (as the stock market is on the higher end and could dip again – although last year was probably that dip).

    Either way, I wish you the best and look forward to seeing your future success! Get those debts paid off and then through money into those investment accounts!

    1. Thanks for stopping by and for the encouragement 🙂 There are so many options when it comes to building wealth and financial freedom, we just have to figure out which way works bests for each of us.

    1. I haven’t really pushed the issue of investing with Mr. Smith too much, because there is also a lot I have to learn when it comes to the stock market. I plan to learn more about it in the next few years, so maybe we can make some educated decisions about investing for our future.

  5. We’ve been investing in our 401(k) plans since we were both in our early 20’s, and we have mostly a mix of low cost, low fee index funds with some bonds for safety. We don’t mind investing in the stock market and also have a taxable brokerage account that we manage ourselves. Studies have shown that the only people who truly lose their money in the stock market, are those who become emotional and withdraw their money while the chips were down so to speak. In fact, after our portfolio took a hit during the Great Recession, we more than doubled our money on the ride back up!

    We do recommend that you really research those REIT’s before investing in them. It’s important to pick the right ones because my parents lost over $400,000 when the Great Recession hit and the real estate market collapsed. Unlike stocks that you can leave alone and wait to come back, they were unable to recoup their losses because the REIT’s they were invested in folded like a house of cards and went into foreclosure. Honestly, we view stocks as the safer investment. Hope this didn’t scare you, but it’s better to be aware! – Mrs. FE

    1. WOW – thanks for letting me know about this, definitely something to keep in mind. There is a lot to learn when it comes to investing, perhaps Mr. Smith will be more trusting if it seems like I know what I’m talking about.

  6. When I was investing in a few individual stocks, my wife didn’t feel comfortable. It was when I finally started using index funds and was able to explain that we were invested in thousands of companies and if all of them collapsed, we had a lot more to worry about, that she finally started feeling comfortable putting so much of our money in the stock market.

    It is important to get your partner on board. Without their support, there is going to be a lot of uneasiness on your journey that will make it a lot harder.

    1. You make a really good point. We currently are investing via my 401K and he seems okay with that, but it’s not a huge amount because of our debt payoff goals. I will make sure to emphasize this the next time we discuss the stock market.

  7. I think not trusting the stock market is kind of funny, but a bit sad because you’d be missing out on a large amount of wealth possibility there. I get the idea of holding real things – but if you invest in Johnson & Johnson or P & G you can go into any supermarket and see tons of their products (you can pick them up & hold them 🙂 )

    If you go into a Wells Fargo bank you could touch and see your investment right there. Same with McDonalds. If you own Microsoft or Apple you use their products every day. Etc etc. All these companies survived the global recession and the people who bought them during the recession are now sitting on massive gains & getting tons of dividend income. If you just invest in companies that everyone uses and have long dividend growth histories then you can’t go wrong. The S & P 500 also ‘survived’ and has grown to new heights. There will be downs of course, if you just invest consistently and regularly you’ll be good with all scenarios. Having most of your wealth tied up in one asset class (property), in one or two locations could be extremely UNdiversified 🙂 It’s only the people that had all their investments tied up in dangerous / undiversified investments that went bankrupt.

    Anyway, having said all that, it sounds like you’ve got something that works for you both – so good job on the compromise.

    Dividendsdownunder recently posted…Saving for the future: MayMy Profile

    1. Very good points! I’m hopeful that we will be able to continue increasing our stock market investments. He’s just really adverse to throwing all of our eggs into one basket – and I can accommodate that, while securing future financial freedom.

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