For American olim in Israel, managing U.S. investments can feel overwhelming—like trying to finish a 1,000-piece puzzle. Between two countries and two currencies, it’s tough to figure out how your dollar investments fit with your shekel-based lifestyle. Are your assets set up to meet your long-term goals? Does your strategy balance growth with protection? These are the questions many olim wrestle with, especially when deciding how to divide up their investments. Let’s break it down and make it simpler.
Asset allocation is a core strategy that balances risk and return to match your life. Here’s a three-step approach to help you take control of your cross-border investments:
1. Know Your Income Sources
Start by looking at how steady your income is. Is it consistent, or does it change? I worked with a couple where the husband’s income was irregular, but his retired wife felt their savings could cover the gaps. If your income isn’t predictable, having cash set aside is like a safety net—it helps during slow months. On the other hand, if your income is steady, you can focus more on long-term investments that grow over time without worrying as much about keeping extra cash on hand.
2. Understand Your Risk Tolerance
Assess how much risk feels comfortable. It is rare for a husband and wife to be fully aligned with their risk tolerance. Often one prefers higher risk while the other wants more safety. Balancing these perspectives helped them design a strategy that matched both. Consider your own comfort with market ups and downs, which will guide your investment choices.
3. Assess Your Financial Risk Zone
Don’t just focus on comfort—ask yourself, how much can I afford to lose? Look at your income, expenses, and when you’ll need the money. I had a client who worried about risk, so we crunched the numbers. Even if she doubled her spending and lived to 100, she’d still leave a seven-figure inheritance. That gave her the confidence to take on a little more risk and grow her investments, creating the potential for an even bigger legacy.
The investments in your portfolio should fit together like a puzzle. If you want help putting this puzzle together, call for guidance. Schedule a free Cross-Border Financial Evaluation at profile-financial.com/call.
Published February 26, 2025.