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7 Simple Tips to Organize Your Investments

If you want to break into the world of investing, it is vital that you have a plan. Organizing your investments as you go will help to ensure that everything can be managed as smoothly as possible.

Categorize your investments

Before you start investing, you should take the time to organize your different investments and work out which ones are best for you. Depending on your goals, there are three main categories that you can choose to invest in. These three are:

●     Liquidity: In simple terms, this is the money that is easily accessible. Keep some money here to use sometime in the near future or to save for an emergency. Liquid investments include things like savings accounts, checking accounts, and cash, to name a few.

●     Longevity: This is money that is being saved for the future. Things like college funds for you or your children, retirement funds, or other future expenses will be classed as longevity investments. If you’re more organized, you may wish to break this category down even further, creating mid-term and long-term sections. For example, your retirement money will not need to be accessed for a long time, so would be invested differently than money for a house you’re planning to buy in the next 5 years.

●     Legacy: This money is being set aside for after you’ve passed away. You’ll likely never use or even see this money in your lifetime, but it is being saved for your children, a friend, or a charity/organization that you’d like to make an impact on once you’re no longer around. This category is best invested in once the other two are covered, to keep yourself set up for your lifetime. 

By organizing your money into these different categories, you will end up with a better overview of where your money is and what it is intended for. This should help to keep you on track and keep your savings in the right place.

Related Read: What are Investment Mandates and Why Do You Need them?

Track your investments using a spreadsheet

If you’re looking for an extra element of control in the tracking of your investments, consider creating a spreadsheet. Using software such as Microsoft Excel can be great to track your outgoings and incomings, calculate aggregate dividend income, as well as curate dividend schedules. If you’re looking for something more internet-based in order to access your spreadsheet anywhere in the world, consider opting for google spreadsheets, which works in a similar way to Microsoft excel but is a little less powerful.

Keep your financial goals in mind

Plan your investments and consider your financial goals when looking to invest. Keep your portfolio balanced and aimed toward your goals. Diversify your portfolio but try not to duplicate where you can. Consolidate your assets and rearrange investments into things that are reflective of your goals.

Use the rule of 72

The rule of 72 is an easy-to-follow tool which is aimed at helping investors estimate the length of time it will take for an investment to double, given a fixed rate of return or a fixed rate of interest. Simply divide your expected rate of return to predict the number of years that your investment will take to double in value

Track your investments using software

In addition to a custom spreadsheet, a number of investors want specific investment software installed on their computers. This software will often come with extra features that are not otherwise available, and you can have them installed on your Fire HD 8 tablet. There are several options available:

●     QuickBooks: this software is great for advanced investors or accountants who have a grasp on Generally Accepted Accounting Principles (GAAP) and will find the flexibility that comes with using traditional software for accountants to manage their investments appealing.

●     Quicken: For most retail investors, the investment version of Quicken will meet most of your needs and help you to keep on top of your portfolio.

●     Fund Manager: This is a very powerful software which is the closest thing to a professional level investment tracking software that is widely available to retail investors. This software is ideal for those who invest in municipal or corporate bonds and can track elements such as interest growth, yield to maturity and the next date of coupons.

Declutter your investment portfolio

Take stock of your investments and reassess your portfolio from time to time. Much like your home, your investment portfolio will likely become cluttered over time as you add to it here and there without too much forward planning. Start to tackle this problem by making a list of each of your investments, every stock, fund, bond or insurance you own, as well as the amount you have invested into it.

It is important to approach this process with caution. Selling your assets like equities will result in capital losses or gains, and getting rid of some of your assets early could result in a tax bite. Investments like insurance may not be good to get rid of too soon, as they offer you long-term protection. So, before weeding out your portfolio, consider each investment properly and work out which are worth hanging on to.

Consolidate your investments

Take some time to organize your investments. Keeping everything in essentially the same place makes paying your bills, keeping track of investments and filling out paperwork much more simple. Think of it this way, would you take out a separate health insurance plan for each respective member of your family, or would it be more efficient to buy just one family plan? Use a similar approach with your investments and consolidate your assets the best you can to save you time and stress in the long run.