Viewers of CNBC’s “Mad Money” stock exchange may be surprised to learn that presenter Jim Kramer does not trade individual stocks and holds half of his portfolio in cash.
His personal investments include:
- 50% in cash
- 40% in US index funds
- 5% in international index funds
- 5% in gold and cryptocurrency
Part of the reason is technical: to avoid a conflict of interest at CNBC, Kramer is not allowed to own individual shares that can be discussed on his show.
But 50% in cash? He attributes this decision to his wife Lisa, whom he married in 2015.
“I’m married and my wife and I are sitting down and discussing our finances,” Kramer told CNBC Make It. “And when I turned 65, she told me, ‘What if I outlive you?’
I said, “Well, that would be great.”
“She said, ‘But what if I have a portfolio of stocks?’ What if the market gets worse after you die? I thought we were partners. ”
“We’re partners,” Cramer recalls. “It simply came to our notice then [my] time to tell people how to deal with the market, “he said, referring to his long career as a financial professional, author and TV presenter.
“She says, ‘I’m not interested in anything.’ We are partners. So, I make an executive decision: 50% of it is yours and 50% is mine. And the 50% I have will be in cash. “
When Kramer pointed out how well the market was doing at the time, she said, “You’re missing my idea. Are we partners? Or are we separated?
“We are partners,” Kramer said.
“Then our decisions have to be 50/50,” she said.
Cramer had previously been 100% invested, but he agreed to move half of their wallet into cash.
“I did it,” says Kramer. “And the market has risen.
“But she just said, ‘Great.’ Your half has risen. But I can sleep at night, and I couldn’t before. “
Kramer still complains about the potential for lost profits from keeping that money aside, but says there are “bigger things in life than money” and he is “happily married.”
And “happiness is pretty good to have.”
To learn more about investing, you can join the CNBC Investing Club with Jim Cramer at a reduced rate.
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