The Princess gives investment tips

Before choosing a retirement plan at my new job, I am encouraged in the paperwork to fill out an Investor Profile Worksheet, which will tell me how much risk I "may be comfortable assuming." Investment matters can be quite complex, so we have offered here some tips for completing such a profile (be warned that following these tips may catapult  you into the "comfortable with an extreme level of risk" category). 


Tip 1. You may be asked something similar to the following: "Which of the following portfolios is most consistent with your personal investment philosophy?" If the options listed do not quite match your personal investment philosophy, feel free to write in one that does, such as: The one that will make me lots of money.


Tip 2. Some investment questions may appear to resemble the math story problems you hated in school. For instance, a question may ask: "Of four hypothetical investments of $100,000 blah blah blah blah over a one-year holding period blah blah blah blah?" In such a case, answer it as you would have back in math class when you had no idea what the answer was: All of the above.


Tip 3. If a story-problem question contains the words "chance of" and "losing money," however, answer: None of the above.


Tip 4. On a hypothetical question about what you would do if your portfolio were to lose 20% over a short period with 10 years until you begin withdrawals, the answers may range from "I would not change my portfolio" to "I would immediately change my portfolio to something more conservative." You should answer: I would immediately put all my money between tissue paper and hide it around the house.


Tip 5. We regret that Tip 5 has been canceled due to a severe headache brought on by story problems. It may return at some future time, or not, depending on the risk of such a move bringing on another headache.


We hope these brief investment tips have been helpful. Remember, the information given herein is NOT intended to help you avoid tax penalties, although spending time reading these tips may help you avoid finishing your tax return. It certainly works for us.