“Habits are powerful, but delicate. They can emerge outside our consciousness, or can be deliberately designed. They often occur without our permission, but can be reshaped by fiddling with their parts. They shape our lives far more than we realize — they are so strong, in fact, that they cause our brains to cling to them at the exclusion of all else, including common sense,” says Charles Duhigg in his book “The Power of Habit: Why We Do What We Do In Life and Business.” 

Some of your New Year’s resolutions may be to break a few of your bad habits and to take on some new, positive habits. We are almost two months into 2017, how are you doing so far? If you’d like to improve upon your investing habits, creating daily, monthly, and yearly routines may help.

Daily Investment Habits

Simple day-to-day routines may be the key to your investment success. It’s important for you to know where your investments stand and to learn from past mistakes. Taking the time each day to gather and record this information may help you throughout the year.

Develop a regular reading and research routine — set aside a small part of each day to read about investments. Perhaps a good time for you is while you’re having your morning coffee. While there is a plethora of financial literature available, you don’t need to read everything that is printed. Instead, carefully choose those publications or websites that give you a clear idea of how the market is performing. You should also read about your particular investments.

Keep a daily journal — jot down notes on trades you make, what happened in the market that day, and your perspective on the investment climate. Over time, your diary entries may reveal patterns and provide you with insight. Recognizing past investment mistakes is the first step in learning from them and modifying future behavior.

Monthly or Quarterly Investment Habits

Get in the habit of evaluating your investments on a monthly or quarterly basis. More frequent assessment isn’t recommended because you may be tempted to make changes based on short-term fluctuations in your investment values.

Evaluate everything — take a look at how everything is doing — not just your retirement accounts or your stock holdings — to get an indication of overall performance.1 Gains in one holding might be offset by declines in another, so you need to see the big picture.

Start keeping score — pick appropriate yardsticks to measure the performance of your investments. For example, choose benchmark indexes that track the returns of the types of securities in which you are invested. Once you’ve established your yardsticks, start keeping score.

Yearly Investment Habits

Once a year, take the time to do a complete review of your investment strategies. Since it may be hard to stick to an annual habit, tie it to another yearly task, such as preparing your income taxes, spring cleaning or end-of-the-year organizing.

Review your results — your routine investment habits may come in handy at the end of the year. You should schedule time with your Financial Advisor to review the performance of your investments. Ask them if your allocations should be adjusted in order to more proficiently meet your investment goals. Reading your investment diary should also help you analyze your successes and failures throughout the year. Your scorecard may help you determine the effectiveness of your investment strategy.


1Investing in stocks involves risks, including loss of principal.


Tim Nichols is a financial consultant with Nichols Wealth Management. He may be reached at timothy.nich- ols@lpl.com. Securities offered through LPL Financial, Member FINRA/ SIPC. The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. Investing involves risk, including loss of principal.

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