Advisor Banner Image

Spring Cleaning Time   


After the long winter, spring is a good time to wash windows, clean your closets, and generally get your home in order. The same can be said for your retirement investments. An annual spring review can help you make sure the investments you have chosen for your plan account still fit your needs.


Dust Off Those Statements

Locate all your retirement plan statements so you can file them away in a safe place. But before you close the drawer, review the recent and long-term performance of your investments. The total return of a fund is expressed as a percentage and includes the increase or decrease in its share price, plus distributions of dividends, interest, and capital gains. In a retirement plan, distributions are automatically reinvested in additional fund shares.

Shine with an Index

Just looking at an investment’s total return, however, won’t give you the whole picture. You also want to see how well your investments performed compared to other similar investments. For that you need to look at your investment’s benchmark index. If your investment’s return is consistently lower than the return of its benchmark over an extended period, you may want to consider making a switch.

If It’s Not Broken, Don’t Fix It

Just don’t be too hasty to get rid of an investment simply because of poor short-term performance. Investments often rebound after brief periods of low returns. If the investment still matches your goals, you may want to take a “wait-and-see” approach before sweeping it out of your plan account. After all, unless you are planning to retire soon, you should have enough time to ride out short-term performance fluctuations.