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Here’s Exactly How Often You Should Check Your Investment Accounts

Carla Fried


When the news is blaring that stocks are falling, it can set off an urge similar to rubbernecking at
a traffic accident. Your impulse may be to log into your investment account and see what
damage has been done to your portfolio.
Joe Wirbick, a financial planner in Lancaster, Pennsylvania suggests you go easy on yourself.
“Checking daily, weekly, or monthly—especially when stocks are down—is just going to make
you anxious,” he says. “That’s not helpful.”
The challenge when markets are volatile is to stay committed to your long-term investment
strategy. And that can be harder to do when you log in and see you’ve lost money.
It’s human nature to be upset by the prospect of a loss. A psychology study co-authored by a
Nobel Prize-winning economist figured out that we feel the pain of a loss about two times more
intensely than we feel the pleasure of a gain.
If you’re being a bit of a financial masochist and checking your portfolio often when stocks are
falling, your desire to stop the “pain” may lead you to decide to move your money into a more
conservative portfolio that owns fewer stocks. That will indeed feel better in the heat of a market
meltdown, but it can come at a steep cost.
If you have a lot of years to go before you expect to use your investments—say for retirement—
moving money out of stocks when they are falling means you will likely end up with a lot less
money later. (That dangerous strategy is known as timing the market.)
“You’re investing for the long-term, and if you have the right portfolio mix, you don’t want to
get caught up in the windstorms that can hit in the short term. That’s not going to get you the
results you want,” says Andrew Whalen, a Las Vegas-based financial advisor. “During
heightened times of volatility, we suggest trying to leave your statements in the mailbox,
unopened.”
So how often should you look? Aim to check in on your investments no more than per quarter,
Wirbick says. Even then, your default approach should be to review without necessarily making
changes.
"If you’re under 50, checking your portfolio quarterly is more than sufficient,” he says. “You’re
at a life stage when you shouldn’t do anything. You want to stay the course. You can handle the
ups and downs.”
When you do check, remind yourself that “volatility is normal,” says Greg Hammer, a financial
advisor in Schererville, Indiana.
“If you have 60 or 70 percent of your portfolio invested in stocks, you should expect losses of
10, 15 to 20 percent at times,” Hammer says.
Indeed, since the end of World War II there have been 12 bear markets, which is when stocks
lose at least 20 percent of their value. The average bear market decline was 33 percent.
But even with all those bad times, the long-term annual gain for stocks is more than 10 percent.
“Volatility won’t hurt you as long as you don’t panic,” says Hammer.
Sticking it out in the bad times so your portfolio can soak up the good times is the ticket to
reaching your long-term investing goals.