How to Monitor Your Financial Portfolio and Make Wise Investment Decisions

Investing is a way of putting your money in a vehicle that has the potential to produce significant returns. Anyone who understands finances knows they could miss out on opportunities to grow their wealth, save for retirement, and reach their financial goals if they do not invest. However, the focus of any good investor shouldn’t just be to buy any asset or put their money into any business that appears profitable but to make wise investment decisions. 

So, whether you obtained a loan or you’re investing money from personal savings, you must think carefully and develop a plan for short- and long-term gains before acting. Even if you hit sudden wealth or you’re expecting a huge inheritance, you should equip yourself with valuable information on growing your finances. Of course, due to legal formalities, it may take some time before you claim your estate or discover that money was left to you. If you’re trying to find a family member’s will, you should research the applicable state laws. For example, according to Florida Probate, a law firm in Florida, ‘’People wondering how to find a will in Florida can petition the probate court to force production of the document.’’ There are several other state laws that empower beneficiaries to claim their inheritances. That’s why you should find out the ones that specifically apply to you.

When you start investing, it is crucial to check and monitor your financial portfolio. A portfolio is a compilation of investments, such as assets, bonds, stocks, cash, cash equivalents, and commodities that an investor owns and uses to earn profit. Managing and monitoring all your investments can be challenging if you’re new to investing. But there are various ways you can check what’s going on routinely and even obtain real-time information on your portfolio. This article will show you those tools that you can use to make your investment journey hassle-free.

  • Customized Spreadsheet

One of the most versatile ways to understand and track your overall portfolio performance is by building your own portfolio tracker on Google Sheets or Excel. Besides being completely customizable, spreadsheets can help you with your calculations and investment projections over time. Also, you’ll be able to evaluate your asset allocation against the investment strategy you’re using. 

Your asset allocation would depend on your purpose of investing. For instance, if you want to use your money for a project you’ll execute within a year or two, such as funding a vacation, you might consider investing in a more liquid asset. On the other hand, if you’re preparing for retirement in 25 years or saving for your child’s college tuition in 16 years, you’ll more likely opt for a long-term investment that has more growth potential. Once you’ve decided on your target asset allocation, you can make more informed investing decisions by using your customized investment spreadsheet to compare your desired allocation against your actual allocation. 

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The first step to creating your personal tracker is to record basic data such as your stock name, buying price, ticker symbol, and the number of shares you purchased. Use one line for each stock category and record them in separate columns. Once this is done, you can conveniently fill each cell using data you obtain from your brokerage firm. If you plan to purchase more stock shares at a different price, you may want to create a new row for recording to avoid confusion. Create another column to determine a break-even formula. Calculating a break-even is crucial in knowing the selling price to aim for. You can have new worksheets to track dividends and calculate your short- and long-term gains.  

  • Personal Finance Apps

Another way to track your portfolio is through personal finance apps. There are so many such apps available in the market, such as Sharesight, Yahoo Finance, SigFig Wealth Management, and Personal Capital. All you need to do is research them thoroughly and select one with features that best suit your needs. 

For instance, Personal Capital has a feature called Investment Checkup that allows clients to monitor their investments by asset class, individual security, or account. It also lets you review your asset allocation, establish a benchmark, and assess your portfolio’s risk level. Sigfig Wealth Management app offers automated investing, which provides daily monitoring that enables users to optimize their returns.

Some of the key features to consider when selecting a portfolio management app are easy-to-use financial syncing of your bank accounts and investments and dashboards with reporting functions for tracking your financial progress. You can also consider whether a finance app has a free version and whether it has a retirement planning tool that incorporates your IRAs and 401(k).   

Disclaimer: This content does not necessarily represent the views of IWB.

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