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I’m quite engaged with the Humble Dollar community and occasionally post articles on the forum. I’m also a keen reader of personal finance articles and books. Being a former business owner with a nearly 40-year-old degree in business and finance, I’m very interested in commentary and the goings-on in the business and finance world. But here’s the strange thing: I’m not massively engaged with my own retirement portfolio. I hardly ever think of it and rarely check its performance.
Oxymoronic behavior of the highest order, I would suggest, but I really think it’s the correct way to approach your portfolio. As a simple example, as I write this post, I could give you an approximate rounded value of my portfolio balance, but beyond that I haven’t a clue. When I next rebalance in April, that’ll be when I know the precise figure.
I assume, with HD readers in general, I’m preaching to the choir, but it’s always worth restating the reasoning and basics. Once you’ve set up a globally diversified portfolio and arrived at your asset allocation for your particular risk tolerance, doing anything else is normally counterproductive.
The reason this approach works is its power to neutralize the worst enemy in investing: ourselves. Constantly checking your portfolio—especially during market volatility—triggers emotional responses: fear and greed. Fear leads to selling low. Greed leads to chasing returns and buying high.
By actively taking a stance of “hardly ever think of it,” you pretty much eliminate the opportunity for these destructive behaviors to influence your long-term plan. In this context, apathy is your secret weapon.
If you’re still accumulating, you can control your savings rate, and we can all control our asset allocation. What we can’t control is the market’s performance. Focus your energy on the former. Only care about the latter when you rebalance back to your target allocation. After that, forget about it again and worry about something more important—like what to make for dinner tomorrow night or why the dog keeps staring at the wall.
Some truths bear repeating, if only because the rest of the world seems determined to check their portfolio apps seventeen times before breakfast.
Don’t know, don’t care. It’s brilliant.
Wisdom, illness, and dementia await us near the end. I’ve learned that an unexamined portfolio is not worth keeping, but I’m afraid my timing will forget me before I remember to check it 🙂
Mark, Would you be more engaged in a prolonged downturn? I appreciate the value of not tinkering with one’s financial plan/assets, but I wonder if your indifference to checking your portfolio is largely due to great returns over recent years. Timing is everything.
I’m not one hundred percent sure. I know during the 2022 bear market and the simultaneous bond slump I did pay more attention to my portfolio, although I never tinkered. I had a reason then: I was planning on retiring a few years later and was concerned about the impact on the plan. Now I have a ten-year fixed-term annuity covering my essential spending and a ten-year consumption bond ladder covering my wants, so I think at this present time I’m well enough insulated that I wouldn’t be concerned enough to pay much attention.
This discussion reminds me of the old joke: What’s the difference between ignorance and apathy? I don’t know and I don’t care.