Do you know how you’re really doing with your investments? You might be surprised at how many investors don’t know the answer to this basic question. Over the years I’ve found a large discrepancy between what people report and what their actual statements say. Part of it can be explained by confusing statements, part by over-estimation, and part by simple lack of interest in the matter.
Most people have several accounts, spread among various financial institutions. They might have a company retirement plan, an IRA, and a traditional brokerage account. It’s easy to keep track of your results when you have all of your money in one account, but nobody does in this day and age.
Another reason for the gap between perception and reality is found in human nature. If you have several accounts, chances are that they will have different results. We have a tendency toward selective memory, where we remember the good performing account more than the poorly performing ones.
Then there’s the problem with the statements. Do the statements you get from your broker or your employer tell you clearly how well you are doing? I’ve found that most investors don’t have a clear understanding of how to interpret their statements. Statements are not presented in a standardized way, which can add to the confusion. Selective memory also comes into play when we remember the good months but forget the bad ones.
The best way to get a clear picture of how you’re really doing in the market is to keep track of all of your accounts in one place, and keep a running tab of your progress from month to month and year to year. But this is time consuming, tedious work that most people simply won’t put up with.
To address this problem, we developed the PTR (Personal Track Record) tool for our clients. It’s a simple spreadsheet that has built-in formulas that make the calculations for you. All you do is plug in a couple of numbers from each of your statements. When you find out what your Personal Track Record is, you will probably be surprised. This is valuable information, because it can help you identify problems you didn’t know you had. Wouldn’t you like to know if reality is different from perception?
If you want to give this valuable tool a test drive for free, send a request by clicking here and we’ll send you the tool. (We have a strict anti-spam policy. We will not sell, rent, or give your email address or contact information to anyone, period.)