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Tuesday, May 28, 2024

Check on your investments in under 5 minutes

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Regularly reviewing your investments is crucial for progressing towards your long-term financial objectives. Even if you don’t intend to make immediate adjustments, it’s essential to confirm that your portfolio remains well-balanced and aligned with your overarching financial strategies. Often, dedicating just a few minutes can suffice to ensure everything is on the right track. Below are some methods to assess the status of your investments and make alterations when warranted.

Portfolio tracking apps

Numerous portfolio tracking applications enable you to consolidate and monitor various investments within a single interface. Products like Empower (previously known as Personal Capital), Simplifi by Quicken, and Intuit Mint offer the convenience of easily assessing all your investments through a unified dashboard.

For instance, using Empower, you can access information such as individual account balances, aggregated balances categorized by account type (including investments and credit cards), and your overall net worth. These portfolio tracking solutions, including Empower, typically offer mobile applications, allowing you to conveniently check your investment status on both your smartphone and computer.

Alerts and notifications

Configuring alerts and notifications within your investment account can keep you informed about critical developments and occurrences. You can establish alerts for various purposes, such as tracking price fluctuations, monitoring account activity, or staying updated on market news. Once your alerts are configured, you’ll receive notifications through channels like push notifications, text messages, or emails when the specified conditions are met.

Widgets

Numerous investment platforms offer widgets that you can integrate into your dashboard to access specific information conveniently. These widgets are typically adaptable and allow you to personalize them to display data such as your total portfolio value, gains or losses, and asset allocation. You have the flexibility to add or remove widgets to tailor your dashboard to showcase only the information that piques your interest.

Watchlists

The majority of investment platforms offer the option to create watchlists for monitoring stocks, bonds, or ETFs that capture your attention. Watchlists serve as handy tools for keeping tabs on portfolio performance or spotting potential trading prospects. These watchlists are frequently organized into categories of comparable stocks, such as “top growth stocks” or “leading large-cap stocks.”

Newsletters

Certain investment funds distribute weekly newsletters that showcase significant market developments. If you hold an account with the fund, you may also have the option to receive weekly summaries that encompass your portfolio’s performance and other pertinent updates. These emails offer a quick and convenient way to glean the essential information you require.

Market news websites and TV

Market snapshots can be easily accessed on websites such as Google Finance, where you’ll discover fundamental data like major stock indices, individual stock prices, and the latest market updates. Alternatively, you can obtain comparable information by tuning into television market news broadcasts.

What to remember while checking your investments

Evaluating your investments extends beyond merely assessing current asset values. It’s equally important to ensure that your portfolio is appropriately structured. A frequent oversight among investors is transferring funds into an investment account, such as a Roth IRA, without subsequently allocating those funds into investments.

Once you’ve deposited money into your account, it’s essential to actively deploy those funds by acquiring stocks, bonds, mutual funds, ETFs, or any other investment instruments that align with your financial objectives.

Likewise, it’s essential to verify the accuracy of your 401(k) contribution percentage. The optimal approach is to contribute the maximum amount possible to your account. If your employer provides matching contributions, strive to contribute at least the amount required to secure the maximum employer match.

Additionally, it’s crucial to review your portfolio allocation. If you’re in your twenties, financial advisors often advise a greater allocation to stocks and a lesser allocation to bonds. As you age, they might recommend an increased allocation to bonds. While assessing your investments, ensure that your asset allocation remains aligned with your long-term financial objectives.

What to ignore during a quick check

Financial markets are intricate and subject to daily changes. When conducting your brief five-minute check, it’s advisable to filter out a significant portion of the information, especially the following:

  1. Short-Term Fluctuations: Investments, such as stocks, can exhibit substantial short-term fluctuations. If you encounter a series of declining numbers, it might trigger concern and tempt you to consider selling. However, if your investment horizon is long-term, these minor intraday drops should typically not influence your overarching investment decisions. Keep in mind that investing is a game played over the long haul, so adhere to your strategy and avoid becoming overly preoccupied with momentary market oscillations.
  2. Media Sensationalism: The media frequently features sensational headlines, and financial news is no exception. These headlines may employ dramatic language to capture attention. Nonetheless, the actual situation is often more nuanced, and you should refrain from letting attention-grabbing headlines sway your decision-making.
  3. Comparison with Others’ Portfolios: You may have heard acquaintances or colleagues boasting about the impressive performance of their portfolios, leaving you wishing your own investments were similarly successful. However, succumbing to this temptation can lead to a pursuit of higher returns, which often proves detrimental to investors. Avoid making comparisons with others and concentrate on crafting a strategy that best suits your unique financial circumstances and goals.

Amidst the myriad aspects to evaluate when reviewing your investments, it’s advisable to disregard daily fluctuations in asset prices. By concentrating on what truly counts, you can make more informed and effective decisions.

Bottom line

Investing can indeed be intricate, and it’s common to feel unsure about where to begin when assessing your investments. Fortunately, various tools are at your disposal, including portfolio tracking apps, watchlists, and alerts, to assist you in pinpointing the pertinent information. Additionally, ensure that accounts like your Roth IRA and 401(k) are appropriately balanced.

Most importantly, resist the urge to let short-term fluctuations and media noise sway your decisions. Instead, remain steadfast in your commitment to the long-term strategy you’ve outlined for your portfolio and retirement.

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