5 resolutions for your portfolio in 2015

Smart investors spend a lot of time valuing stocks, divining big macroeconomic trends and looking for fresh and innovative strategies that hold up to analytical rigor.

However, getting the basics right matters, too. And you’d be surprised how many investors trip up over the simple stuff.

So, as 2014 draws to an end, here are five resolutions for 2015 worth considering.


Truth Test your Portfolio

Take a hard look at your portfolio performance, financial adviser’s strategy and individual holdings.

Did the portfolio outperform and with a tolerable level of risk? If not, why not?

Some portfolio’s lag the broader market because a handful of investments fell out of favor.

Sometimes, this is only a temporary speed bump if those depressed holdings still have solid fundamentals driving them.

Other times, the problems run deeper and point to the need for a serious rethink about investment goals, strategies and risk appetite.

Does the asset allocation in your portfolio still make sense given the economic facts on the ground?

Does your adviser have a workable game plan for improvement? Is it time to make a change

Retirement contributions

Some 41% to 43% percent of U.S. households may not have enough set aside to fund their retirement, according to the Employment Benefit Research Institute’s Retirement Readiness Ratings.

So if you can afford to make the maximum contribution to your 401(k) plan this year, do so.

You can save on a pre-tax basis and employers often match a certain percentage of your contributions.

Starting on January 1, employees will be able to contribute up to $18,000 annually to their 401(k) plans.

Automatic savings

Saving consistently takes a certain amount of discipline and not everyone is able to put aside cash for retirement once the paycheck hits your bank account.

That’s why a smart way to save with discipline is to set up an automatic deduction from your paycheck to your 401(k), IRA or other long-term savings account.

About that bonus

There’s nothing wrong with splurging a little after a year of hard work.

But, really, before buying that Maserati, take a realistic look at your personal financial situation.

If your retirement savings aren’t adequate, divert some or all of that windfall into your investment portfolio.

Another option: Build up an emergency fund that can cover expenses for six months or so in the event of a crisis.

Bonuses and other financial windfalls aren’t a sure thing. So don’t comfort yourself with the thought that you will salt away the bonus next year and books those tickets to Las Vegas this year.


It goes without saying that investing isn’t free. Investment products and services come with costs and fees.

And if you’re not vigilant, these costs can take a big bite out of your nest egg over the long term.

Consider the findings of a recent SEC investment advisory:

If you invested $100,000 and assumed 4% annual growth, your portfolio would take a $10,000 hit from a 0.50% annual fee and a $30,000 haircut if the fee burden was 1%.

If your fees are too high, don’t be afraid to shop around.

Online platforms that cater to “do-it-yourself” or semi-involved investors ready to take control over their financial decisions offer low fees.

Just be sure the solution you choose is upfront about fees, and you can understand how and when you’ll be charged.


All of these are sensible steps that don’t require an advanced degree in portfolio management.

Once you have these bases covered, you can consider bigger strategic questions about the management of your portfolio.

So why not head into 2015 with your finances on sound footing?

Photo Credit: nlmAdestiny via Flickr Creative Commons

DISCLAIMER: The information in this material is not intended to be personalized financial advice and should not be solely relied on for making financial decisions. Past performance is no guarantee of future results.