2021 new year, new you: How well does your portfolio stack up against your goals?

By Zoe Morris

December 29 2020
Share

Markets in 2020 were challenging and unpredictable, but 2021 offers families an opportunity to review their portfolio and make sure they are still in alignment with their financial goals. Your life, and your accompanying goals are bound to change, and you need to ensure your investments are working as hard as you are to meet these, writes Zoe Morris.

How well does your portfolio stack up against your goals

As a financial adviser, I work with my clients to empower them and help them reach their life goals. Whether you’re entering a new life stage like marriage, your business or cash flow is changing, or you are considering retirement more seriously, the new year marks a turning point to check in on your goals and to ask what’s important to achieve your financial dreams.

It’s a challenge for any financial adviser to see their clients feel overwhelmed or think their investments are out of their control, so I understand how reviewing your financial goals can drop to the bottom of the ‘to-do list’. It’s easy to procrastinate and get caught up in the everyday (or plan your dream holiday to Queensland).

That’s why I always work to understand my clients, their specific needs and objectives so I can help them reach what is important to them. So before the clock strikes midnight, here are some key things to think about to help you review your investment portfolio and see if it stacks up against your goals.

Where to start

It may sound easy, but checking in on your superannuation is a good place to start. You may have an account from your first part-time job that is still active. Since then, you may have had a few different jobs. Is there a statement lying around to help you identify any old accounts? Consolidating these funds alongside your other investments will help to ensure they are working towards your financial goals. Understanding where all assets outside of your cash portfolio live is a key way to maintain a clearer vision of your overall investments. You may be surprised by what you find.

Ask the personal questions and evaluate your plan

Think about setting up your investments by asking yourself questions that reflect your overarching financial goals such as: Are you expecting a baby and require more easily accessed cash flow for the coming years? Or are you 15 years from retirement and can tolerate higher risk for a possibly high return within that period?

Working with a professional who will advocate for you and your goals against market changes is vital. Your first session with your financial adviser can be based around getting to know each other and what boundaries you would like put in place that enable your financial adviser to make informed decisions on your behalf.

How involved do I really need to be?

Often, obsessing over the market and unit price fluctuations day-to-day may trigger panic buying or selling. This can also give you an inaccurate picture of those investments that rely more heavily on long term growth.

But you do need to be aware of changes in fee structures and market movements to ensure it is appropriately reflected in your investments and your financial goals are accurately accounted for in your portfolio. To help you overcome uncertainty partnering with a financial adviser can help apply your personal financial goals to the decisions they make on your behalf.

Make checking in a habit

Reviewing your investments shouldn’t fall into the ‘too hard basket’. By making investment reviews a habit, you can reduce the stress, as well as some associated risk that comes with not understanding your investments and their growth nature. Always planning ahead, having an agreed contingency plan, and knowing your boundaries is key to feeling comfortable with market changes and trusting the ebb and flow of an investment portfolio.

There are always going to be market fluctuations with downturns and recessions. As we saw in 2020, it can be very easy to be disheartened or overwhelmed by the uncertainty of investing. Aligning with an adviser that you trust and who understands your goals will help to keep your fears at bay, and get on track to achieve your 2021 financial goals through your portfolio.

Zoe Morris is an ANZ financial adviser.

About the author

Zoe Morris

Maja Garaca Djurdjevic is the editor of nestegg and Smart Property Investment. Email Maja at [email protected]

About the author

Zoe Morris

Maja Garaca Djurdjevic is the editor of nestegg and Smart Property Investment. Email Maja at [email protected]

sections

most read

sections

most read

sections

most read

sections

most read

sections

most read

sections

most read

sections

most read

Most read

Age Pension increase prompts Australians to review their finances

Latest Podcast

Australia’s credit pivot: Mortgage enquiries hit a three‑year peak as households ...

Resources

There is $17.5 billion in lost and unclaimed super across ...

ROOT