Managing money can be stressful, in large part because it’s hard to know exactly how to track what’s working and what’s not. There are decisions to be made on how much to invest, how to properly split your savings up and invest in a strategically smart way.

Questions investors often ask themselves are:

  • Where is the best place to invest my long-term savings to get a decent or better return?
  • What ARE we actually tracking here? 
  • What’s a “good return”? (Or is “return chasing” bad?)
  • How do I know if my portfolio is working well in today’s market?

There’s so much information available about WHY it’s important to invest, and so much less information available about how to know that you’re finding success with investing. Of course, it’s impossible to speak to your individual situation without knowing you or your current investment strategy; however, there are a few key steps that investors can take to hone in on whether or not their strategy measures up based on their goals and market performance across the board.

Step One: Understand Information

It’s tough to know whether your investments are performing if you don’t fully understand what’s happening in your portfolio! As a result, brushing up on your investment terms is an excellent place to start. In fact, we believe that knowledge is power when it comes to investing – so we’ve put together a full blog post defining key terms to help get you started.

Beyond being able to define terms, it’s important for you to know:

  • What you hold in your portfolio. Are you invested in stocks? Bonds? Mutual funds? If you don’t know already, it’s time to brush up on what’s in your investment accounts! Do you have a 401(k) at work? Do you know what you are invested in there?
  • What your risk tolerance is. Are you risk averse? Are you a risk taker who pushes through investing fearlessly? (To learn more about the role risks plays in your portfolio – click over to our recent post on the topic here).
  • What your strategy has been up until now – and whether or not that still serves you. This may be the trickiest piece of your investment puzzle. Most people align their investing with their retirement timeline, but there are so many other ways that investing can positively impact your other financial goals from purchasing a home to funding the lifestyle or business venture you’ve always dreamed about.

Personally, I recently looked at a 529 account I have to save for school tuition and expenses to finish my degree and I noticed that the fund it was invested in wasn’t doing well any more. When I looked into all the funds available to me, I decided to switch to two new funds that were performing much better and increased my returns by more than 5%.

Step Two: Know Your Returns

Once you understand what’s going on in your portfolio, next you must understand what returns you’re currently getting from your investments. The best way to do this in to track it. Checking in can help you to see whether they’re working for you or not. Determining your return takes into account firstly, your tax bracket, referred to as after-tax yield, as well as any inflation that may have occurred. If you’re not familiar with the math on this, your investment professional and tax accountant can help.  

Step Three: Set Your Goals

This step is the needed forward vision to create something wonderful for yourself. It really is important to set goals, and then also have a regular routine of attaining them. Most people grossly over-estimate what can be done in a year, but under-estimate what can be accomplished in three or five years. Be honest with yourself – what do you want life to look like a few years from now? What about 5 years? 10 years? 40 years? 

For many people, they’ve only dreamed of one “end goal” – retirement. But also realize that a lifetime savings habit can also fund the many, fulfilling years between now and then. And once you do arrive at retirement, what do you want your lifestyle to look like then? Do you want to have a funded retirement or will you be forced to look for a job just to make ends meet? Having a clear understanding of your goals can help you to structure an investing strategy that puts you on the path to accomplish a fulfilling life and minimize regrets. 

Step Four: Be Conscious Of Any Disconnect

When you set goals for your life, it can be easy to get out of sync with reality. Goals like:

I want to buy a million dollar home next year.

I want to retire before 40 and travel the globe on my sailboat (even though I only have $10,000 currently saved).

I’m looking to send both of my kids to school then go back to school to earn my masters – 100% debt free.






Those are some big, beautiful goals. They need to be broken down into actionable chunks with time periods assigned to them and you must have the income to support them. Depending on the time horizon involved with them, they may or may not be achievable through diligent saving and investing – even if your strategy knocks it out of the park and helps you to earn high returns over the next several years. It’s important to be aware of when there’s a disconnect between your goals and the corresponding expectations you hold for your investments.

Step Five: Increase Your Earning Capacity

What skill sets do you have that you could put to use and get paid for? Are you working in a job where you are underpaid by industry standards? Is there a hobby or business you’ve always wanted to start that could become a 1 or 2 day a week side gig for you? Is investing in some training or a license in order to allow you to do what you want in order? Spending an hour or two with a career or business coach may uncover ideas for income-earning you’ve never considered before. Earning more money is mindset first. Learning how to market yourself in the business world is  step two.

Step Six: Work With Professionals

Working with a professional career coach, wealth manager or investment advisor comes with too many benefits to count. First and foremost, a professional can help you to decrease the impact that stress has on your career and investing decisions. We all need to talk over important decisions and gather input to make the best one. He or she can act as a sounding board or a voice of reason as you decide to stretch to reach new unfamiliar goals or adjust your investing strategy. Someone who has been where you are headed is one the best assets you can have. 

An investment advisor can also help you to accurately measure the success in your portfolio against objective industry standards and help you to view your investing goals in a realistic light. The investing game is a long-term proposition. Well-respected businessmen like Warren Buffett all say that building wealth is a slow gradual process and investing must be looked at over the long-term. When you work with an investment advisor as your financial professional, you’re starting a journey on the path toward your goals. Want to learn more? Contact us today! We’d love to talk with you about your investment story thus far, and how you’re measuring success in your portfolio.


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