Not keeping an eye on an investment once you have bought it
So you made an investment and then forgotten all about it? It’s only when something goes wrong that you realise it should have been noticed sooner. Most things in daily life get checked periodically; bank statements, the amount of fuel left in the car, your teeth…! The same applies to your investments. If you don't keep regular tabs on them, you could see years of savings go up in smoke.
Too few investors subject their investment portfolio to a regular review. But if you set aside an hour or two every six or 12 months to look at how your investments are doing, to ensure nothing's going off the rails and costing you money without you realising it, you could be doing yourself a massive favour.
If you have a high-risk investment portfolio, you should give it a close inspection at least every quarter. Similarly, if you are approaching retirement, it is increasingly important to keep an eye on your portfolio. When you are 5 years or less away from retirement, you definitely need to start looking at your investments more closely. You need to think about locking in your gains and moving to more cautious territory as the date closes in.
You don't need to go crazy and change everything each time you examine your investment. But keep in mind that reviewing your investments is about more than just checking performance. There is no way of knowing if your investments are really meeting your needs unless you take stock and reconsider your objectives.
Consulting with a season professional can help clarify objectives and deliver a consistent but flexible approach to meet future changes such as increases in income which may mean your tax position has altered. Also, you might be missing out on tax brakes by not conducting a review once a year. This could result in you paying thousands of pounds in extra tax on profits made.