Ken Fisher Explains How and When to Do an Investment Portfolio Review

Transcript

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you know about the worst thing most
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people can do
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is to pay attention what happens to
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their portfolio every day
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uh it's a little bit like saying that
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you should be paying a lot of attention
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to
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happens to the second hand of a clock
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it's just going to keep you away from
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things that are more important
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the reality is for most people they
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don't need to check their portfolio too
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often
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uh
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and of course that is going to vary to
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some extent based on who you are or who
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any person is
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but
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in in a very simple sense
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the best time to actually
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think about a year-end checkup on your
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account
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on your portfolio on your investments
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is actually not at your end
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the reality that i learned
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when i was a kid
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is that the
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calendar year
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is kind of artificial
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in reality almost all real projects in
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the real world
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go on over a much longer period than a
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year and particularly not associated
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with a calendar
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year
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taxes are done on a calendar year basis
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and you get a lot of people in december
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trying to take tax losses
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to
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minimize the tax effect for the next
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year
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and one of the worst things you can do
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is to try to take tax losses right when
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everyone else is taking tax losses
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because you're trying to sell the same
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things that they're trying to sell just
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when they're trying to sell them
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so you tend to sell low and then have
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the things that you would want bounce
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back before you can get to them after
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the mandatory
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weight before you can buy them back
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the best time to think about these
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things is to create your own sort of
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fiscal year end
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for planning purposes that's in the
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middle of the calendar year
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and to take your tax losses
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in maybe the late summer
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kind of the notion of buying your straw
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hats in the winter and your skis in the
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summer
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to take advantage of the fact that
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people aren't doing tax law selling then
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and then you want to review your
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portfolio to make sure it's still
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consistent with your longer term needs
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because really the only purpose of your
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portfolio in the first place is what are
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you trying to accomplish in the long
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term and for most of you the long term
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is longer than you can feel emotionally
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and once a year is a good time to go
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back and say what's really important to
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me what are my goals what am i trying to
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accomplish where do i want this
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set of investments to take me in the
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longer term and why
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and
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that's one of the most basic financial
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planning questions you could ever ask
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and is worth to think through from the
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beginning
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sort of once a year again maybe at that
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same time
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uh when you're not distracted by
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holidays when you're not distracted by
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what it what to get as a
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present for your grandchild or or your
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sister or your spouse
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it in the calm of a quiet time to think
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through what is it that i really need
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these to do for me in the long term
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and
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then once you're comfortable that
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nothing's changed in your life in the
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year that would change that
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and you're comfortable with what you've
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done relative to minimizing tax impacts
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you've pretty much done the job
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thank you for listening
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[Music]
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