7 Ways to Show Your Investments Some Love

Dear Readers,

Today let’s talk about an important relationship you may be hesitant to discuss. You know, the one you can’t live without, even though it may sometimes cause headaches and heartaches. —No, I'm not talking about you and your partner, I'm talking about the relationship between you and your investments.

Sure, you’ve made some money mistakes in the past. We all have. And we’re all trying to have a healthy relationship with our finances and break destructive habits. So here’s some friendly advice from someone who over the years has not only heard tales of joy about investing but also stories of woe, worry and sorrow—and a few ideas on how you can show your investments some love.

1) It’s not your investments—it’s you

As with every relationship, you have to take some responsibility for how it's going. Are you disappointed in your returns? Look at your own behavior. Most investors receive less than market returns. Why? Because all too often they chase after the hottest thing, jumping in and out of the market, rather than staying the course. If you want to be more a successful investor, you need to have a plan and stick with it. Investing is a long-term commitment.

2) Get serious 

Investing isn't a game to be played lightly. There's real money at stake. If you want the potential for serious returns, you need to be serious about what you're doing. Don't be satisfied with the superficial or taken in by the glitz. Rather, get to know an investment before you commit. Do your research. Read the prospectus. Make sure it’s a good fit for your asset allocation. Remember, investing isn't a fling. It's something you want to be a part of your life for the long-term.

3) Leave the past behind

I should've bought TESLA when it went public…saved that raise…I should never have taken on that car payment… We all have money regrets. But rehashing the past is pointless unless you can learn from it—and change your course. Wish you had invested differently? Take a look at your goals and timeline. Want to save more? Make a budget and stick to it. Need to get out of debt? Create a realistic repayment plan. As they say in investing, past performance is no guarantee of future results. In the same way, obsessing over past mistakes can cause you more harm than good. Better to get over it and move on—with a new plan of action.

4) Pay attention

It's often ignoring the little things that can ruin a perfectly good relationship—as well as the not- so-little things. With investing, you need to pay attention to essentials like your expenses. They may seem small, but they can add up. Bigger things like changes in your risk tolerance and time horizon definitely shouldn't be ignored. Plus, you need to check in periodically to make sure you're on track both with your savings and your goals. That doesn't mean you have to constantly monitor your account balance or spend hours watching the markets. But if you don't give your investments enough attention, you might be caught off guard when they go off course.

5) Stop worrying about what other people think  

Your relationship with your investments is unique. It's about your goals, your needs and your wants. If you're right for each other, it doesn't matter what anyone else thinks. Whether you made X percent more or less than your friend is irrelevant. The most important thing is whether or not you're able to reach your goals—not someone else’s. FOMO and social media can distract you from focusing on what's right for your situation. So swipe right on friends who encourage you to follow your own plan—and ghost anyone who tries to tell you to invest in something that doesn't fit your goals. No matter what others are doing, invest for yourself and what you care about most.

6) Shed the baggage

Your first relationship is rarely the one that lasts forever. Finding the perfect match takes experience. The same goes for investing. Bitcoin curious? When you’re just starting out, you often experiment, trying to find what's right for you. This can result in owning a bunch of random mutual funds, ETFs and individual stocks rather than having a well-thought-out portfolio that's a good match for your goals and feelings about risk. So take an honest look at what's working and what's not. Get rid of investments that don’t fit in or support your goals. It's often better to cut your losses by rebalancing, rethinking your asset allocation and timeline—and starting fresh.

7) Find a new BFF (best financial friend)

A little outside perspective can help you see your problems—and solutions—more clearly. So seek out help when you need it. There's plenty of online investing information available. But often there's nothing like expressing your concerns to someone who is knowledgeable and willing to listen. This could be a trusted friend or family member, or an investment professional. And don't forget about your spouse or partner. Money is notorious for causing personal problems. Talking openly and honestly about your financial concerns may help strengthen both your personal and investing relationships.

Have a personal finance question? Email us at askcarrie@schwab.com. Carrie cannot respond to questions directly, but your topic may be considered for a future article. For Schwab account questions and general inquiries, contact Schwab.