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Monitor Your Investment Accounts

Monitor Your Investment Accounts

In a typical cross-country flight, the plane is on autopilot 98% of the time.

Does this mean the pilots are unnecessary? I don’t know about you, but I want an experienced pilot in the cockpit to fly the remaining 2% of time and to immediately take over if there’s a problem.

Managing your finances is no different. 

Do as much as you can on autopilot, but check in occasionally to make sure you’re still on course and there are no problems. Paperwork is inherently boring, but you don’t need a Ph.D. in finance to track your progress. Although there are a hundred things I’m sure you’d rather do than sort through your account statements, if you want to get control of your finances, you will have to spend a little time in this area. You just need a workable system that takes the guesswork and frustration out of monitoring your accounts. Say hello to that system.

If you use a bank or a brokerage account at another institution, you can effectively track your progress. It’s a deceptively simple but effective six-step process— it just takes a little bit of work.

Step 1 – Buy Supplies

  • Three-inch, three-ring binder
  • Three-hole punch
  • A box of three-hole punched plastic protector sheets
  • Three-hole punch divider tabs

Step 2 – Create Your Goal Tracker Binder

Label the tab on one of the dividers, “Financial Health: Net Worth,” and put it in front of the three-ring binder. You will insert a new Net Worth report behind this tab every quarter. Keep the newest Net Worth report in front of the old ones.

Now create a label and divider for each investment account with the name of the goal on the tab. The accounts should be put in order of importance. Keep your more important goals in front of less critical goals.

Step 3 – Complete a Goal Tracker Report Card

Create a “Goal Tracker Report Card” (template from The Six-Day Financial Makeover). Complete the template for each account, insert it in a plastic protective sheet, and put it immediately behind the divider tab for each account. You can quickly and easily look at your Goal Tracker Report Cards for each account to see how much you’ve saved, how much you’ve earned, and if you’re on track to reaching your goals.

Step 4 – Insert Account Statements

Every time you get an account statement from your bank or brokerage firm (usually monthly), insert it behind the Goal Tracker Report Card for that account. This ensures you have all of your account statements in chronological order and in one place.

Step 5 – Update the Goal Tracker Report Card Every Month/Quarter

Every month (or every quarter if you’re a Hands-Off Investor) after you get your account statement, complete a new Goal Tracker Report Card. Update how much you’ve contributed, the value of the account, and how close you are to reaching your account. Verify any transactions that occurred or that should have occurred. For example, if you have a direct deposit payment scheduled to occur twice a month, look at your statement and make sure it was processed.

It’s been said that to err is human. To really err is your bank or brokerage firm! Mistakes happen all of the time and can cost you hundreds or thousands of dollars. If you are cash-flow clueless, you won’t even know it. Don’t leave it up to them to make sure your money is making it to the right place.

Step 6 – Make a Financial Date with Yourself

Whether you use the old fashioned binder system or one of the off-the-shelf computer programs discussed below, you should make a date with yourself at the same time every month to complete a new Net Worth Report and Goal Tracker Report Card for each account. Although it might sound like a lot of work now, you’ll probably begin to look forward to this monthly date. It should take less than twenty minutes and it will give you the opportunity to see how well you’re doing and how close you’re coming to reaching your goals.

If you’re really fancy and are computer savvy, there are some pretty neat software programs that can help you keep track of your goals and accounts electronically. They can download transactions from your bank and investment accounts directly into the program. These programs make running a net worth statement and tracking your accounts a breeze for the right person.

The only problem with them is that they require an investment of time to learn well. If you have the aptitude and the patience, they can help you sort out and track your finances.

The proceeding blog post is an excerpt from The Six-Day Financial Makeover: Transform Your Financial Life in Less Than a Week!, available now on Amazon.


About the Independent Financial Advisor

Robert Pagliarini, PhD, CFP®, EA has helped clients across the United States manage, grow, and preserve their wealth for the past 25 years. His goal is to provide comprehensive financial, investment, and tax advice in a way that was honest and ethical. In addition, he is a CFP® Board Ambassador, one of only 50 in the country, and a real fiduciary. In his spare time, he writes personal finance books, finance articles for Forbes and develops email and video financial courses to help educate others. With decades of experience as a financial advisor, the media often calls on him for his expertise. Contact Robert today to learn more about his financial planning services.

Reach us at (949) 305-0500