From
Your Perspective:
Identifying an investment strategy
Reallocating your
portfolio
As you might suspect, your 401(k) needs and
strategies will change over time. Not only will you grow
older, but your
risk
tolerance, tax bracket, retirement assets, and future income
needs may change depending on your career, family, or lifestyle.
And there’s no telling whether or not your investments
will perform according to your original expectations. In
addition, market conditions may change from time to time
— meaning you’ll have to reevaluate your approach
to investing.
So, it’s a good idea to get into the
habit of evaluating your investment strategy periodically.
If you find that your goals — and subsequently, your
strategy — have changed, you can modify the way you’ve
allocated the assets in your 401(k), as often as your plan
allows, from once a day to once a quarter, though most experts
suggest that a once-a-year portfolio reallocation is frequent
enough.
Once you’ve identified your investment
strategy and
asset
allocation,
it’s up to you to keep track
of your investments. Your employer is required to
report the status of your 401(k) account at least
once a year — but most plan sponsors automatically
provide reports on at least a quarterly basis. And
in most cases, you can check your statements online
as well.
