6 Time-Saving Investment Tips

October 26, 2017

You know it’s important to monitor your investments, but do you ever wish it took less time?

Many investors tell us that time holds them back from true investment success.

They want to make educated investment decisions, but they find that other life responsibilities put their investments on the back burner.

Successful investors have figured out how to make investing a habit. It becomes something they schedule and take care of every month, like paying a bill.

How can you create better investing habits? Here are some tips.

1. Create a plan

Perhaps the best way to speed up your investment decisions is to have a plan, and then stick to it. (It helps to write down your plan so you can refer to it later.) A plan can help you avoid second guessing yourself, stay focused and make the decisions that really matter.

Your plan should include the criteria you’ll use to determine which funds to buy now, how long you’ll hold your funds and when you’ll sell. It should also include whether you’ll own sector funds or diversified funds, and if you’ll pay a transaction fee to buy a fund or stick with no-transaction fee (NTF) funds.

By making these decisions in advance, you’ll streamline your investment decisions. This is what we do for the client accounts we manage, and it saves from having to make the same decisions again and again.

2. Keep it simple

Your investing process should be simple enough that you’ll be able to stick with it for many years. Some say it should fit onto an index card. (This is a great reason to write your plan down: many people think they have a straightforward process, but once they write it down, they realize that it’s more elaborate than they’d thought.)

If your plan takes a lot of time and effort, look for ways to simplify it. Could you consolidate some of your accounts so you have fewer accounts to manage? Perhaps you could eliminate some of the research you’re doing by relying on other resources, or maybe you could achieve similar results with fewer funds. When investing is easier to manage, you’re more apt to actually do it.

3. Get your research done for you

Some investors tell us that they spend a lot of time researching their investment options, and one way to simplify this work is to rely on data from other sources. For instance, subscribers to my NoLoad FundX newsletter have a team of people who do an enormous amount of research for them.

We look into each fund’s strategy, diversification, risk, and its past history, and we often talk with fund managers. We also look at how a fund trades and we make sure that ETFs have sufficient liquidity so our members will get a fair price.

We make sure the funds we cover work with our system and with other funds. It’s like putting together a top sports team: there may be a very talented player out there, but that player has to be able to fit in with the rest of the team to really make a difference. We believe the work we do saves investors time and helps them invest wisely and with confidence.

4. Trim your portfolio

Do you own too many funds? Keeping track of many funds takes a lot of time, so you may consider owning fewer funds.

If you are spending a lot of time managing a portfolio of stock funds and a portfolio of bond funds, you could consider simply focusing on balanced funds, which give you exposure to stocks and bonds in one fund purchase. The balanced fund (Class 4) portfolio in NoLoad FundX includes just five funds, and it’s done well in up and down markets.

5. Consolidate your accounts

Many investors have too many accounts. They have 401(k)s, contributory IRAs, rollover IRAs, Roth IRAs, inherited IRAs as well as assorted taxable accounts, and it can take longer to keep track of so many accounts.

When clients hire us to manage their money, one of the first things we do, when it is the client’s best interest, is look for ways to consolidate their accounts or at least move their accounts to one broker.

Fewer accounts are easier to manage: you’ll readily see how your accounts are allocated and if there are any changes to be made. You’ll also have less paperwork to deal with. And by consolidating some of your accounts, you’ll making it easier for someone else to step in to manage your finances if anything happens to you.

6. Get help

The investment writer Jason Zweig said that “the single greatest challenge you face as an investor is handling the truth about yourself.” You may find that investing isn’t what you want to spend your time on, and that’s OK.

Many investors—even investors who managed their own money for decades—end up hiring an advisor to manage their portfolios for them. Many of my clients successfully managed their own money for years before they decided that they wanted to spend their time on other pursuits.

Some clients and shareholders come to us for help managing part of their portfolio. They may find enjoy managing their stock fund portfolio, for instance, and they’d rather have someone else choose bond funds for you.

It can be freeing to let a professional take charge. Many say it’s comforting to know that someone’s watching their portfolio while they’re on vacation or recovering from an illness. Getting help managing your money can also give you more time for the things that research shows makes us happier, like spending time with friends or family.

This originally appeared on Forbes.

Print Friendly

Previous post:

Next post: