New Year's Investing Resolutions BY John Sadeghi

1. Get Organized

   Spread out the statements, confirms and bank accounts on the floor and organize every batch by the calendar. Organizing the statements forces you to look at your returns and transactions through out the year. Did you make too many transactions? Did you sell something when you shouldn't have? The important thing is to learn from your mistakes. The biggest problem investors have is that they are not organized enough to know what they're investments are doing for them. Getting started is the hardest part but confronting that big pile is a must.

2. Simplify Your Life

   Do you really need five bank accounts and six brokerage accounts? Consolidate your accounts into one or two accounts. If you have fewer accounts it makes it easier for you to know what you own and if you have the proper asset allocation. At financial firms like Alamo Capital we can shop around for the best CD rates and keep it all in one account. So, if you're worried about the FDIC limit of $100,000 you can own CD's from five different institutions in one brokerage account.

   The same premise goes for brokerage accounts. The fewer accounts that you have the better handle you have on your investments. Let your investment advisor review your entire portfolio for the appropriate asset allocation and recommendations.

3. Have a Strategy

   Work with a professional financial advisor and formulate an investment strategy that works for you. The strategy has to make sense to you and above all you have to be comfortable with it. Make sure you have the proper asset allocation among different asset classes. How much exposure do you have to the real estate market, tech stocks or high yield bonds? Do you really know the answer? Maybe you have half your portfolio in volatile tech stocks and you don't even know it. If stocks go up one month don't take money out of bonds and put it in the market. Look at the big picture and make your decisions according to your long-term goals. Stick with your strategy. Don't make costly emotional decisions.

4. Get Your Estate in Order

   It's one thing building a portfolio and another passing it on to your loved ones. Make sure that you have a will, durable power of attorney and a medical directive. Talk to an estate attorney. He might recommend that you set up a living trust to reduce your estate tax or shield you from a costly probate. We've all heard nightmare stories of outrageous legal fees and unreasonable estate taxes. Protect yourself by talking to an estate planning professional and an estate attorney. The few hundred dollars that you spend today will save your loved ones thousands when you pass away.

5. Work with a Professional

   After your health and family your money is usually the most important thing to you. So, why do so many people pay so little attention to it and don't seek professional advice? A big part of the reason is that there is a barrage of advertisements that prod you into investing for yourself. If you want to have some play money to buy the next Microsoft put aside 5% of your investment dollars for the long shot. The rest of your portfolio should be professionally managed and reviewed on at least an annual basis. No one has a crystal ball but a good financial advisor can give you the direction and advice that will make you money in the long run.