What Kind of Investor Are You?
When it comes to investing, there’s no one-size-fits-all strategy, because there’s no one-size-fits-all investor. Whether you’re just getting started or refining an established portfolio, understanding your personal approach to risk, time, and goals is the foundation of making confident financial decisions.
Use this to help find your balance by aligning your risk tolerance, time horizon, and financial goals into a personalized investment mix. Through a short interactive assessment, you’ll uncover your investing style and receive a score that connects to suggested asset allocations, along with visuals that illustrate how risk and return work together, giving you a clearer, more confident path forward.
Finding Your Balance
Creating an investment mix is how you decide to allocate, or divide, your assets or investment dollars. When making your investment decisions, you should consider these three factors: your risk tolerance, your time horizon and your financial goal. By determining your risk tolerance level, and considering how long you have to invest, you can begin to create your own personal investment mix.
Answer the Following Questions:
1. How many years do you have until retirement?
a. Less than five. (1 point)
b. Five to ten. (2 points)
c. More than ten. (3 points)
2. When it comes to making investment decisions, which of the following best describes you?
a. Not very knowledgeable. (1 point)
b. Very knowledgeable. (3 points)
c. Somewhat knowledgeable. (2 points)
3. Are you willing to take on more risk in exchange for potentially higher rates of return?
a. Yes. (3 points)
b. No. (1 point)
c. Not sure. (2 points)
4. When it comes to making investment decisions, which of the following best describes your philosophy?
a. I worry about losing my money and lean toward having a more conservative investment mix. (1 point)
b. I would not hesitate to take on higher risk because I know it’s the only way to achieve potentially higher returns. (3 points)
c. I believe in taking my time and investigating all my options before making a decision. (2 points)
5. Which of the following best describes your current attitude toward investing for retirement?
a. I would like the opportunity for my retirement savings to grow, but am only comfortable with a medium amount of risk. (2 points)
b. I tend to worry that the value of my retirement savings will go down. (1 point)
c. I would like the opportunity for my retirement savings to grow as much as possible, and am willing to take on higher risk for potentially higher returns. (3 points)
TOTAL YOUR POINTS: _________
Scoring System
5 – 7: Conservative. You are an investor who seeks stability and safety for your money. Remember, not having enough money when you retire is a big risk too. Keep in mind your time horizon and the impact inflation can have on your investments.
8 – 9: Moderate. You want your money to grow but are more concerned about protecting it. You are cautious but may be willing to diversify to spread out some of your risk, depending on your time horizon.
10 – 11: Moderate Growth. You are an investor who likes to balance lower-risk investments with higher-risk investments. Evaluate your situation at least annually to make sure that this balance contains the right mix of lower-risk and higher risk investments appropriate for your situation.
12 – 13 Growth. You want to increase your savings and are somewhat comfortable riding the ups and downs of the stock market in exchange for the possibility of higher returns over the long term. You may have more time on your side until you retire.
14 – 15 Aggressive Growth. You want to maximize the long-term growth of your retirement savings. You are comfortable taking substantial investment risk in exchange for potentially higher returns.
Based on your score, you are a(n) _______________________investor.
Ultimately, this type of assessment is a foundational step that financial advisors regularly use when working with clients. By identifying your risk tolerance, time horizon, and goals early on, advisors can build a strategy that is both personalized and sustainable, helping you stay committed even when markets fluctuate. Taking the time to understand your investor profile not only leads to more informed decisions, but also creates a clearer roadmap for long-term financial success. Whether you’re just getting started, revisiting your current strategy, or simply have questions about your results, our team is here to help.
This material was prepared by Kmotion, Inc. and provided by LPL Financial and Wealth Manager Group.
This information is not intended to be a substitute for specific individualized financial, tax, or legal advice. We suggest that you discuss your specific situation with a qualified financial, tax, or legal advisor. LPL Financial and LPL representatives do not provide tax or legal advice.
The opinions expressed and material provided are for general information, and should not be considered a solicitation for the purchase or sale of any security.