Finally, when it comes to investing, it makes sense to review how things are going fairly early on as a new investor. I suggest a formal review once a year, and only checking in on your portfolio once a month. It is vital that you don't tinker too much, but instead, leave the portfolio to do its thing over time.
As a new investor I suggest that three months after you begin investing regularly, or after investing your first lump sum, that you sit down and ask yourself the following questions:
a) Am I happy with the split between accounts?
Chances are you won't change anything too often here, but this will also provide an opportunity to review the total amount being invested. Can you squeeze an extra £50 or £100 out of your budget to invest? How might this be apportioned?
b) Am I happy with my chosen risk profile?
Three months isn't long at all to experience the ups and downs of the stock market. If you have a very difficult three months and your money is worth less than you put in, you may be tempted to change your risk profile. I would urge you strongly not to do so.
We're going to talk about behaviour later in the book, but as you become more proficient as an investor you will come to understand that your risk profile is actually very high-level concept. Of more on-the-ground importance is the general trajectory of your portfolio.
c) Am I happy with my chosen provider/platform?
This comes down to ease-of-use, availability of an app for your phone, how reports are laid out and how easy they are to understand, things like that. It may well take longer than three months for any annoyances to come to the fore, but it may not.
Remember that shifting between accounts and platforms is easier than ever, so don't feel like you're stuck with your original choice if you think there is better out there. Always watch for fees though, if you transfer to another provider.
d) Am I happy with my chosen fund?
Again, three months isn't long to pick up any issues with your chosen funds, but maybe you have been considering alternatives as your knowledge and understanding grows. Perhaps you can use this opportunity to shift your investment to a different fund or to add a second fund into the mix.
This three-month review needn't take long. Chances are you won't make any changes at all, but I think it is important to set a date just to take a look at things. If you're happy with how things are going, the next review should be at the anniversary of your first foray into investing.
You should also carry out a review if something significant happens, like a windfall, or a change in your employment situation for example. Review things intentionally and proactively as often as you need to, but not too often.