How to Quiet the Financial Advice Noise
There is no shortage of financial advice available to us these days. You hear financial advice on the radio and TV, from financial advisors, your neighbor, or your brother-in-law…and the list goes on. In some cases, we find it is so overwhelming that people have a tendency to do one of three things:
1) Block out all the financial advice they hear and only listen to their advisor.
2)Listen to all of it and then use some of it based on their personal knowledge and feelings about particular investments.
Basically they pick and choose or selectively implement some of what they hear.
3) Lastly, (and the worst way to deal with the noise in my opinion), is not to listen to anyone, just keep the money in cash,
and maybe buy a CD or two.
Do any of these three courses of action sound familiar to you? If yes, here is one simple strategy that will help you take a more balanced approach to all the advice, and do it without causing you to feel overwhelmed or anxious.
The strategy has three simple steps but we are only going to focus on one of the three right now. The first one is to identify your risk tolerance and time horizon for each portfolio. The second step is to utilize a program that allows you to monitor and track all of your investments. And the final step? Making adjustments to investments and accounts that need obvious help. This is usually easy and obvious if you have a good monitoring program, based on the information you receive from that monitoring program.
Today we are going to focus just on step two in our strategy to quiet all the noise. This, in my opinion, is the simplest of the three steps. It also seems to have the biggest impact by quickly helping people feel more in control. Step two utilizes an aggregator program that allows you to see all your investments in one place. There are quite a few out there and they are not expensive. Each has a strength and weakness you will want to understand before committing to one.
Okay, so why is seeing all your investments in one place so helpful? There are a number of reasons but the three biggest ones are:
You can compare and contrast how a Stock Portfolio Manager Orlando investment is doing over time versus your other investments (and the S&P 500) quickly. This is important because investments change and perform differently in different economic times, so if you are doing a review and comparing your investments, you need to do it using multiple views based on different time frames, and you should be able to see all your investments as you look at these different views together.
Monitoring your investments is easier. You are monitoring your credit with LifeLock, your home with a security system, and your kids with GPS technology. But are you also closely monitoring your investments? You need to watch over all your investments in one place, constantly review them, and do it securely. The program is basically like having a security camera watching over your investment accounts. Using a monthly or quarterly statement from your financial institution is not enough anymore.
Receive, on a regular basis, unbiased reports and views of your investments. Most of these programs securely link with thousands of financial institutions, allowing you to monitor your investments without needing to open a new account, change advisors, or transfer any funds. One of the biggest objections I get to monitoring a person’s account is they will say “I have an advisor that I like and trust, so I do not need to do this.” I am not suggesting changing advisors or even changing investments. I hope you trust your bank, employer, and credit card companies too, but that does not mean you should not also be utilizing a credit monitoring program like LifeLock.
Now, there are other benefits to using a program like this. To name just two, it’s a great way to get and stay organized. You also make it easy on your loved ones should something happen to be able to see, audit, and review all your investment assets in one place.
You have a lot of choices when it comes to this strategy. We use Blueleaf.com for our clients and would love the opportunity to show it to you, and demonstrate how it works. There are other programs too, such as mint.com, personalcapital.com, or emoney. So if this is an idea you would like to at least explore, please give us a call. We offer a no obligation 30 minute consultation.
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