Resolve to Do What You Can With Mutual Fund Investments, Then Relax

As the new year starts, it’s time for a little--or maybe a lot of--self-improvement.

Chances are your list of resolutions includes vows to address a few health problems such as losing weight or quitting smoking, or to get some other situation--credit card debt maybe?--under control.

If you’re an investor in mutual funds--and even if you aren’t--you should think about adding a few resolutions related to that. Herewith, some suggestions from financial professionals:

* Sign up for an automatic investment program. If you don’t already participate in such a program, you should. It’s the best way to make sure you will stick with a savings plan.

If your employer offers a tax-deferred retirement savings plan such as a 401(k), you should be participating. Your money will accumulate untaxed until you withdraw it, which means your return on it will be that much better. How does this relate to mutual funds? Many if not most of these programs offer a selection of funds. In addition, many companies will match part or even all of their employees’ contributions.

If your employer doesn’t offer such a plan, or if you just want to save further, you can arrange to have a mutual fund company deduct a fixed amount from your bank account at a set interval and put the money to work in one or more of the company’s funds. Even a small amount, say, $50 a month, will make a big difference over time.

* Get financial help if you need it. A beginning investor is more likely to need a guiding hand in choosing investments and determining realistic long-term goals. You’ll want to be sure you work with a professional who’s competent and whom you can trust.

Realize that anyone can claim to be a financial planner and that qualifications and ways of doing business can vary widely. Deciding to work with a particular planner is not something to be taken lightly. Ask friends or relatives if they have worked with anyone good, or ask a family accountant or lawyer whom he or she consults for financial advice. Check county courthouse records before you hire anyone, to be sure that person hasn’t been sued by a disgruntled client or charged with a crime.

Even if you are an experienced investor, it might be worth asking a professional whether you should be doing things differently. That might mean a quick visit to a financial planner or other expert who can review your plans and your portfolio. These people can offer reassurance if you’re on the right track--and advice for fixing your plan if you’re heading in the wrong direction.

* Don’t lose sleep worrying about your fund investments.

If your choices are well-diversified among large- and small-company stocks, bonds and international investments, and you know you’ve made your best effort, then roll over and get some rest. You probably need it after all that eggnog.

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Clint Willis is a freelance writer who covers mutual funds for Reuters.