The tools you need to become a master investor.
July 7, 2019
If you’re not in a financial industry, chances are you leave your investing to a so-called professional. Any savings you have are administered by someone who is an expert investor. They manage your portfolio according to the amount of risk you’re willing to let them take, and hopefully get reasonable returns.
However, these days, there is no reason for you to rely on someone else to invest for you. All you are doing is giving someone else control over your finances and providing them commission for what you could be doing yourself. And you could be doing a better job.
Investing has become easy, with improved technology and tools that no previous generation of investors imagined. It can be an exhilarating hobby, and you can earn a lot of income using money you already have.
Here are the tools which will help you become a master investor.
The robo-advisor has changed investing entirely. A robo-advisor is exactly as it sounds. It uses algorithms to come up with the best decisions you can make with your investments. To see a comparison of the various options, click here.
Robo-advisors are capable of holding exponentially more information than humans can. They have all the data regarding an investment’s history, all the way up to the present moment. They have problem solving abilities that help them figure out what will likely happen next.
You can decide how you want to use a robo-advisor – including how much decision-making power you give them, as well as the values and principles by which you want to make trades. Unlike humans, they are not swayed by emotion or cognitive biases. They are the ultimate tool that gives you the capability to become an investor with as little risk as possible.
Big Picture Apps
Ultimately, regardless of how capable a robo-advisor is at investing your money, you still want to have control over your portfolio. It is important that you keep up to date with what you have and where your investments lie. Doing this yourself is time-consuming and repetitive. Rather use a big picture app like Personal Capital.
Personal Capital details your portfolio in graphs and charts, showing you where your investments lie and how they’re doing, explaining the decisions your robo-advisors are making, and giving you a fair amount of control.
It also helps that Personal Capital has a premium plan through which you can speak to human advisors. While they can’t give you the same quality of prediction as robo-advisors can, they can help you with the more human, emotional side of investing. Psychology plays a huge role in your decision-making, and since everything ultimately comes down to you, you need to have an idea of how you make decisions.
Finally, if you don’t have savings with which to invest, you need to find them somewhere. This is where budgeting apps can help. Anyone who is not budgeting their incomes and expenditures is inevitably losing money. There is simply no way you are spending as wisely as you could be if you don’t have a clear idea of where your money is going.
Budgeting apps like Mint do all the work for you, by connecting to your bank accounts and categorizing everything you earn and spend. After using one of these apps for a couple of months, you’ll find yourself saving money without even having to put in much effort.