Your investment portion of your financial training plan is similar to the strength training you do in your physical training plan. My goal is to ensure that your investments are strong enough to support you so that you can live your best life.

In this episode of Money Mile, I’ll share two concepts that you can implement in your investment portfolio to strengthen your financial plan. Listen in to hear how you can beef up your investments to optimize your life.

You will want to hear this episode if you are interested in…

How to maintain your portfolio over time

Over time your portfolio needs maintenance to reset your optimal asset allocation–this process is called rebalancing.

Rebalancing is essential to developing a strong investment portfolio. If you don’t rebalance, it is kind of like training hard, but never testing yourself. Rebalancing is like resetting your training targets for your portfolio.

There are 3 primary benefits to rebalancing your portfolio regularly: increasing your confidence, decreasing your risk, and potentially increasing your returns.

Tools for rebalancing your portfolio

Engaging with your portfolio periodically will increase your confidence that it is doing what you want it to do. If you are investing for the long-term I suggest you rebalance annually. If you need the money in less than 5 years I suggest you rebalance more frequently than that. Listen in to hear how often you should assess your portfolio.

Portfolio funds can be an excellent tool for automatic rebalancing. These funds are either time-based or risk-tolerance-based. If you are 10+ they could be an optimal solution if you don’t want to rebalance each year.

However, portfolio funds aren’t for everyone. If you are less than 10 years from retirement it is important to start paying more attention and take more of the reins. If you don’t feel like you can effectively manage your portfolio, reach out to see how I can help you.

A tax-coordinated approach

Tax-coordinated portfolios require you to have investments in different account types for tax purposes. These account types could be taxable investment accounts, traditional IRAs, and Roth IRAs. The type of account you hold an investment is the primary factor in the tax ramifications of the investment. Learn how you can use a tax-coordinated approach to reduce your tax burden.

Now it’s time for your homework. When was the last time you rebalanced your portfolio? Are you within ten years of needing your savings? If so, reach out to see how I can help to ensure you are doing the best you can and adjusting your portfolio appropriately for your lifestyle.

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