Run a one-hour yearly review that keeps your plan current without tinkering with it.
Many people who invest for the long term agree that they should look over their portfolio once a year. The difficulty comes when they actually sit down to do it. One common failure is that the review spreads into open-ended research with no finish line. The other is that it gets skipped, and the skipped year is still counted as a review.
A review is a yearly check lasting about an hour. You work through the same checklist each time, and you change the plan only in places where something real has changed. Deciding what stays off the checklist is as important as deciding what goes on it.
Grace spent a whole weekend on her review last year. She went back through forum threads, set her funds against ten new ones, and watched three videos predicting where markets would go next. At the end, the only thing that had changed was her mood. Farhan (also invented) spent ten minutes on his, because he skipped it. Neither counts as a real review: Grace fell into research and Farhan fell into skipping.
Your checklist has four parts. First, look at your allocation and rebalance by rule. Second, look at each fund for real changes. Third, look at the rules that surround your accounts. Fourth, write down what changed and leave the rest untouched.
Your starting point is the account map from Lesson 7.4, Draw your account map. Bring every account value up to date on a single day, add them up across all your accounts, and set each asset type against its target.
Follow your rebalancing rule to the letter. For anyone using the hybrid rule from Lesson 6.2, the review date already sits among that rule's check dates. Where a band has been crossed, you rebalance, putting new money to work first where you can, as Lesson 6.3 describes. Where no band has been crossed, you note "inside band, no trade" and carry on to the next item. Either outcome is a success, since the decision was made by a rule you set down while you were calm.
Then work out your bad year figure again. It is the dollar amount your portfolio would lose if shares dropped 30%, based on the one-line allocation from Lesson 1.4. As the portfolio gets bigger the figure gets bigger too, so it needs redoing each year. Ask yourself, honestly, whether you could still see that sum vanish and hold on without selling. A different answer from last year gives you a genuine reason to look again at your allocation. Of the market-related numbers on the checklist, this one alone can lead to a change.
Pull up the sheet you made in Lesson 3.5, Build an ETF comparison sheet. Using each fund's most recent factsheet and annual report, refresh three figures: TER, tracking difference (fold the latest year into the average), and fund size.
Ignore small shifts from month to month. If a fund has lowered its TER, you do nothing. Give a fund closer attention if its tracking difference has grown wider two years running, or if its assets have fallen sharply. Lessons 3.2 and 3.4 set out why those two signs deserve attention.
Next, see whether a cheaper equivalent has appeared: a new fund tracking the same index, or a lower-cost class of a fund you already hold. Moving to it means selling first. You pay commission and spread, and you may spend some time out of the market. A new fund also comes without a track record. Make the switch only if the all-in saving is clear and likely to hold for years, and the new fund has the history and size you would need to trust it. A gap of a few hundredths of a percent rarely repays the cost and effort of moving.
Account rules and limits shift over time, and so do your goals. Once a year, go through these:
the SRS contribution cap and any change to SRS rules, on the IRAS website CPF interest rates and CPFIS rules on the CPF Board website, if you use CPFIS or are considering it your broker's fee page, for any change in commission or platform fees your goals, time horizon and savings rate, looking for new goals, dates that have moved and changes in income your share class choices from Lesson 4.3, if you have gone from building the portfolio to drawing on it
Most years, very little on this list will be different, and that is perfectly fine. You checked on a date of your own choosing, which means a change does not reach you by chance.
Close with a short note carrying the date. It should cover what you checked, anything you changed with the reason, and the date of your next review. When Farhan writes his first proper one, it records that he rebalanced because shares had reached 71%, that Fund B had lowered its TER so he did not need to switch, that he looked up the SRS cap, that his goals were the same, and that he will review again on the first Saturday of January. He keeps the first Saturday of January as his review date because it is also one of his rebalancing check dates, so a single sitting handles both jobs.
Anything outside the checklist you leave as it is. That covers forecasts, popular sectors, and lists of funds that did better than yours last year. The purpose of the review is to keep your plan current. When you adjust things simply because you have blocked out an hour and feel you should do something with it, a careful plan can drift, change by change, into the chat group portfolio described in Lesson 2.3, One world fund or a set of building blocks.
Settle on a date you will really stick to. Dates linked to something that already happens each year, like the first weekend of January, your birthday, or the week your bonus is paid, are easier to keep than one picked at random. Choose your date before you write your checklist, so that the checklist has an appointment to belong to.
Put your yearly review date in your calendar now, and write the checklist you will use on that day.
Junxiong-WFG Organisation is an authorised representative of AIA Financial Advisers Private Limited (Reg. No. 201715016G).