A willingness to rebalance an investment portfolio — to buy and sell investments at regular intervals in a way that keeps your intended asset allocation in place — is considered a cornerstone of investing success.
“Everyone says they want to sell high and buy low, and that is exactly what rebalancing does,” says Jean Mote, CFP professional and principal at Mote Wealth Management in Cedar Rapids, Iowa.
And yet, financial advisers say they often struggle to convince investors of the value of portfolio rebalancing.
Alan Dossett, CFP professional and founder of Waypoint Financial Planning in Westborough, Massachusetts, believes people are reluctant to rebalance because they find it too difficult.
“It’s time-consuming,” he says. “I think that’s why most clients don’t do it.”
Bankrate talked to a host of financial planners to get their insights into how to make rebalancing easier and more successful. Following are some of the most commonly cited tips.