Building a Smarter Investment Portfolio in 2019

End-of-year is a popular time to revisit investment portfolios and earnings goals. In fact, while we often associate New Year’s resolutions with things like working out and losing weight, research shows the top resolution of 2018 had nothing to do with health; It had to do with money. As we look ahead to 2019, it’s a great time to take a closer look at your financial well-being, including where you’re investing your money and what it’s earning for you. The following are a few simple tips to get you started.

Know your options. It’s one thing to know you’re passionate about investing in healthcare real estate or senior housing, but it’s another to understand the full range of investment opportunities within those sectors. For instance, those interested in investing in senior housing could choose to do so through a REIT, a private equity fund, a 1031 exchange, or even a direct investment in senior housing itself. Each has its own distinct strengths and challenges. Get to know each and ensure your money is invested in the option that works best for you.

Assess your comfort level. Today’s market isn’t a stable one, and for some that’s OK. But for others looking for a more reliable investment due to stage of life or personal preference, it may be time to consider some other options. The thing is, the investments we’ve traditionally looked upon as “safe” aren’t as reliable as they used to be. For instance, the S&P 500 lost half its value in the last recession—and some experts feel we’re overdue for another in the coming years.

Some investments, especially alternative investments like senior housing, may offer both stability and higher than average returns in a volatile marketplace. If you’re risk averse, get to know the pros and cons of alternative investments and how they may be able to help diversify your portfolio.

Determine how much cash you can lock up. It’s great to invest—but you also need to be realistic about how much you can afford to invest and for how long. At Senior Living Fund, we always encourage our investors to take a look at their long-term cash flow needs before locking up a set amount of funds. If someone tries to pressure you to lock up your assets: run.

Set clear goals. It's easy to put our investments on auto-pilot, but setting clear goals will keep your money working for you more powerfully long term. For instance, if you have income from a real estate sale anticipated in 2019, take time to plan for a 1031 exchange so that you can defer your taxes on your investment gains. Yes, it takes a bit more time and effort. But creating a plan will go a long way toward expanding your capital.

Do the legwork. There is no such thing as a 100 percent passive investment. The responsibility is always on you and your financial advising team to research the opportunity. Get to know the REIT, company, or fund manager you are entrusting with your investment. At the end of the day, the welfare of your money lies with you.

And lastly, revisit this list every few months moving forward. Life circumstances—and markets—are constantly changing. It’s your responsibility as an investor to ensure your money is working for you.

Quinn Brewer is a communications expert for Senior Living Fund, a private equity company that invests in quality senior housing opportunities nationwide. He lives in Kansas City and can be reached at [email protected].