Detox your finances to improve your financial health
As you get into shape for the New Year, work out a plan to also get your finances into better shape than they were before.
07:45 19 March 2014
Any good investor knows the importance of reviewing their investment portfolio more often, and what better time to do that than by doing it at the beginning of the year. It is wonderful to have a financial adviser but you should not give your whole life to one. You need to know what is happening with your finances and know where your money is being spent.
1.Review your Holdings
Markets are always changing and assets classes perform differently year in and year out. Well planned portfolios need to be reviewed and rebalanced as markets shift over time. If you are not careful, things can change so much you may not be able to meet your goals because your risk profile has changed so much.
Serious investors know the wisdom of spreading their risk because one will never know what the markets will do. If you have heard the saying “not putting your eggs in one basket” should be used in investing. Putting all your money in one asset class can lead to your undoing. Spread your money to cash, equities and properties. Find 10 to 20 funds you can put your money into.
Spread your risk into different countries, different regions, and economic sectors that have a history of long-term growth not just short-term spikes. Try not to make last minute lump sum payments, spread your payments over a period and get used to saving money in a savings account each month. Watch your finances, control your debt.
3.Seek help when you need it
It is always worthwhile to seek advice from a reputable independent financial adviser. If you think you can do it alone, find out all the information you need to know and use financial tools such as interest calculators to make a success of your venture in the investment world.