It’s a new year and for busy people this is a time to re-evaluate how you are spending your time. Here are five time-consuming financial tasks that that those who have better things to do are too busy to be spending your time on in 2019.
#1 Tracking gains, losses, and cost basis for your tax return
Raise your hand if working on your tax return is the #1 thing you love to do in your spare time. As if the post holiday letdown isn’t enough, early January brings the tedium of having to gather tax documents ad nauseam: healthcare receipts, W2 forms, 1099 forms, and more.
The list seems endless.
Most people are too busy to look past what the brokerage statements say about capital gains and losses and to find opportunities to prune positions. Accounts may be held at more than one custodian which only adds more time to the process.
Needling around in the nitty gritty of tax loss harvesting, or using investment losses to offset gains for a particular period, is not for the busy of heart. Consider an automated investment management platform to do this for you.
#2 Trying to predict this year new market movements
Some people follow the markets as a hobby but the reality is that in order to be aware of all that you need to be in order to make the right investment decisions, it can amount to nothing short of a full time job.
In another blog we estimated that market research can take 20+ hours per month. Investing in individual stocks? Add another 15 hours. That’s not even counting the time required for researching any portfolio trades you may make.
Read How Much Time It Actually Takes to Manage Your Own Money for an estimate of total time required.
The bottom line is that busy people can’t serve two masters. What if you make a mistake? Some mistakes can take years to come back from and there’s no way to predict when a volatile market will take you for a ride. Anyone with substantial interest in growing their wealth should consider handing over this responsibility, at least in part, to a dedicated professional.
#3 Reviewing your portfolio risk profile
As you’re busy living your life, your investment goals and risks may change. Getting married? Having a child? Retiring?
These are not episodes in life when free time abounds. They are times in life where mental and physical energy are focused on living and the background becomes a distant murmur.
But aren’t your finances worth more than that?
Change in risk tolerance or return preferences that result from a modification of life position warrant rebalancing of a portfolio. Rebalancing is also necessary when the market causes the portfolio to move too far from its targeted mix of asset classes. It is too important to push to the back burner and should be automated for busy people.
Plus, rebalancing can get expensive. The financial services industry is famous for its fees and investment managers are no exception. The impact can be significant over time.
#4 Which investment to put your bonus check into
So you got last year’s bonus check and surprising there is a little something over after you took that family vacation to Aspen and paid off your living room renovation.
What do you do with that lump of money sitting there? You may consider adding it proportionally to your existing positions, or finding new ones. As mentioned in #2, the time required to do this correctly is not insignificant.
You busy money making machines out there will agree that your best function is exactly that: expanding the revenue stream. What if you were to dedicate the maximum amount of time to making the money instead of managing it?
#5 Re-organizing and tracking all your financial accounts paperwork
Blame it on the millennials, the first generation to be raised entirely in the digital age, but in many industries, a heavy reliance on paper is becoming a thing of the past. Financial services is no exception.
Yet in the digital age there are many institutions that require paperwork to be completed in physical form for critical tasks such as account opening, account transfers, a change of beneficiary designation, etc. And then you have to wait in line at the post office to mail it in?
And how do you consolidate all assets held away at different custodians ? Who has time to manually input all holdings from another account into Microsoft Excel, or to even track down these statements in the first place?
It’s so 1982. I mean, this went out of style with Cyndi Lauper.
For busy people, life is too short to be cracking out the fax machine. Find a firm who will service your portfolio without a pen, pencil, or sheet of paper in the mix. And it’s even better if they have a system that assigns you a portfolio ID as a way to keep track of everything in one place.
Once you lose a minute of your time, you never get it back. Start taking back your time and sign up for a free trial of our WealthVenue platform.