Comments on: Checking Your Long-Term Investments Every Day – A Horrifically-Bad Habit http://interestingmoney.com/2008/03/13/checking-your-long-term-investments-every-day-a-horrifically-bad-habit/ Yet Another Personal Finance Blog Mon, 05 Mar 2012 19:02:02 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: Rocko Chen http://interestingmoney.com/2008/03/13/checking-your-long-term-investments-every-day-a-horrifically-bad-habit/comment-page-1/#comment-4601 Rocko Chen Tue, 25 Mar 2008 15:20:25 +0000 http://www.interestingmoney.com/2008/03/13/checking-your-long-term-investments-every-day-a-horrifically-bad-habit/#comment-4601 Perhaps having a definite exit plan would help lessen the tension from market volatilities. Perhaps having a definite exit plan would help lessen the tension from market volatilities.

]]> By: Enough Wealth http://interestingmoney.com/2008/03/13/checking-your-long-term-investments-every-day-a-horrifically-bad-habit/comment-page-1/#comment-4530 Enough Wealth Fri, 14 Mar 2008 13:14:41 +0000 http://www.interestingmoney.com/2008/03/13/checking-your-long-term-investments-every-day-a-horrifically-bad-habit/#comment-4530 I've been monitoring my accounts daily for over ten years (before that valuations weren't often available online, so you mostly had to "make do" with monthly printed statements). You don't <i>need</i> to check your balances daily, but doing so does no harm if you have the "right" mental attitude. You get used to daily ups and downs and can learn to view volatility dispationately - "Oh, I'm up $50,000 today" - "Oops, I'm down $50,000 today" ;) It's quite surreal that my net worth can jig up and down by tens of thousands in a day, yet I still focus on saving a few dollars by bringing my lunch to work from home. The trick is to view your net worth and portfolio performance with your "long term" hat on, and yet live day-to-day sticking to a budget of expenses that matches your disposable income by putting on your "short term" hat. If you can't mentally cope with volatility, I'm not sure only checking monthly will help - you're likely to just get an even bigger shock. Either never bother checking the balances at all, or reallocate into an asset mix that provides volatility that is in line with your risk tolerance. I’ve been monitoring my accounts daily for over ten years (before that valuations weren’t often available online, so you mostly had to “make do” with monthly printed statements). You don’t need to check your balances daily, but doing so does no harm if you have the “right” mental attitude. You get used to daily ups and downs and can learn to view volatility dispationately – “Oh, I’m up $50,000 today” – “Oops, I’m down $50,000 today” ;)

It’s quite surreal that my net worth can jig up and down by tens of thousands in a day, yet I still focus on saving a few dollars by bringing my lunch to work from home. The trick is to view your net worth and portfolio performance with your “long term” hat on, and yet live day-to-day sticking to a budget of expenses that matches your disposable income by putting on your “short term” hat.

If you can’t mentally cope with volatility, I’m not sure only checking monthly will help – you’re likely to just get an even bigger shock. Either never bother checking the balances at all, or reallocate into an asset mix that provides volatility that is in line with your risk tolerance.

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