In This Chapter
Understanding your investment goals and other big-picture issues
Selling for the right reasons
Factoring taxes into your profit
You can and should hold good investments for years and decades. Each year, people sell trillions of dollars' worth of investments. My experience helping people get a handle on their investments suggests that too many people sell for the wrong reasons and hold on to investments that they should sell. In this chapter, I highlight important issues to consider when you contemplate selling your investments.
If your life has changed since the last time you took a good look at your investment portfolio (or you've inherited investments), your current portfolio may no longer make sense for you. I generally recommend that you review your holdings once per year. Don't make quick decisions about selling — take your time and be sure that you understand tax and other ramifications before you sell.
The time that it takes you to manage your portfolio, for example, is a vital matter if you're starved for time or weary of managing time-consuming investments. Leo, for example, loved to research, track, and trade individual stocks — until his daughter was born. Then Leo realized how many hours his hobby was taking away from his family, and that realization put his priorities into perspective. Leo now invests in time-friendly mutual funds and doesn't follow ...