“It’s not the load that breaks you down, it’s the way you carry it.” — Lena Horne
Have you ever walked into a room and instantly known it was too warm, or sat outside only to realise the breeze was just too chilly for comfort? Just like we each have a unique comfort zone when it comes to physical temperature, we all have a distinct “financial temperature”—a level of risk that we can live with, comfortably and sustainably.
But here’s the catch: many of us don’t actually know what our financial temperature is. Or… that it changes.
We think we do, until the market drops suddenly, or we find out we’ve left too much money sitting in cash “just in case.” Risk tolerance is not static. It’s shaped by emotion, memory, personality, and life stage.
And, most importantly, it’s something we can learn to understand and recalibrate.
So, how do we find our financial temperature?
Take a moment to reflect:
- How did you feel during the last big market dip?
- Have you ever regretted not investing sooner, or wished you’d waited?
- Are you more motivated by the idea of gaining rewards or avoiding losses?
If you tend to feel anxious during times of financial uncertainty, you might be leaning toward caution, perhaps too much. If you’re often chasing the next big win, your thermostat might be turned a little too high.
Neither is wrong. What matters is whether your current temperature is serving you.
Why it matters
Your financial temperature influences more than just your investments. It shapes your spending habits, your savings strategy, your insurance decisions, and how you plan for retirement. It can keep you up at night—or give you peace of mind. When you’re unaware of your default setting, it’s easy to drift into patterns that no longer reflect your values or goals.
For example, fear might push you to hold back from investing, even when the plan is sound. Greed might tempt you to take unnecessary risks that don’t align with your life stage. And overconfidence might make you miss the warning signs that a change is needed.
Adjusting the dial
Risk tolerance doesn’t need to be an all-or-nothing decision. Small, intentional steps can help you rebalance. You might:
- Revisit your financial goals. What are they really about? Are they long-term, short-term, or somewhere in between?
- Check your portfolio with your planner. Are you in alignment with your current stage of life, or stuck in an old plan that no longer fits?
- Think about how you want to feel when you think about your money. Calm? Empowered? In control?
At WellsFaber, we believe that financial advice is as much about emotional awareness as it is about percentages and projections. We help you find your baseline and support you in adjusting the dial so your finances feel aligned with your life, not at odds with it.
When your financial temperature is just right, confidence follows. Let’s get you there.
We advise, you thrive.