2. Rebalance Portfolio and Create Cash Flow
Rebalancing is an essential component of investing to minimize risks, yet a Wells Fargo/Gallup survey found that only 54 percent of investors with personal financial advisors “rebalance their investment portfolio (buying or selling funds in order to restore the portfolio to its original asset allocation) at least once a year.”
“Selling investments as part of the annual rebalancing of your portfolio could provide another opportunity to generate cash flow,” Williams said. “Annual portfolio rebalancing is especially important when you’re retired, as your allocation should generally become more conservative as you age, especially if you plan to tap investments, rather than leave them to beneficiaries or other goals, in retirement.”
You might feel that rebalancing is overrated, but periodically adjusting your holdings is crucial to staying on course. Whether you’re still working or already retired, speak with your financial advisor to see what adjustments are necessary to strengthen your portfolio.
Related: The Dangers of ‘Set It and Forget It’ Retirement Plans
