Time to Rebalance: Aligning Your Asset Allocation with Your Goals
- Heather Asteriou
- 3 days ago
- 2 min read
Ever felt like your retirement portfolio has a mind of its own, drifting off your carefully planned path? You're not alone! Market fluctuations naturally cause your account's investments to shift over time. That's why an annual rebalance is essential—to keep you on track to achieve your retirement dreams.
Why Rebalancing Matters
Think of rebalancing like realigning your car’s wheels—it keeps your portfolio running smoothly toward your destination. Regularly adjusting your investments ensures your account stays true to your risk tolerance and goals, protecting you from unexpected market turbulence.
Here’s why it’s essential to rebalance your retirement portfolio annually:
Maintains your target risk level: An effective 403(b) / 401(a) rebalance strategy ensures you're neither too risky nor too conservative.
Protects your returns: Proper allocation boosts your long-term investment returns by managing risks.
Locks in gains: Selling high and buying low as you rebalance helps maximize potential returns over time.
Signs Your Portfolio Needs a Rebalance
Your portfolio might be calling out for a rebalance if:
Recent market movements have drastically changed your stock-to-bond ratio.
You've experienced life changes (approaching retirement, significant financial shifts).
You haven't reviewed your account allocations in over a year.
How to Rebalance Your University Retirement Account (Step-by-Step)
Rebalancing is easier than you might think! Here's a quick guide:
Log into your Fidelity or TIAA university retirement account.
Navigate to the “Performance” or “Manage Investments” section.
Check your current asset allocation (stocks vs. bonds).
Compare this to your original allocation goal.
Adjust your funds to realign with your target allocation.
Example: If your target is 60% stocks and 40% bonds, but your current account shows 70% stocks due to market gains, move some funds from stocks to bonds to restore balance.
Common Rebalancing Mistakes to Avoid
Ignoring it: Can lead to unintended risk exposure and potential performance dips.
Doing it too often: Annual checks are typically sufficient; overly frequent rebalancing can hurt long-term gains.
Not doing it at all: Can leave you exposed to unnecessary risk, hurting your retirement goals.
💡 Pro Tip:
Set an annual reminder to review and rebalance your portfolio. It's a small action that can make a big difference in your financial peace of mind.
Stay On Track:
Want more ways to stay financially fit? Download our free Annual Tune-Up Guide, complete with a step-by-step checklist to ensure your retirement portfolio remains aligned with your goals.
At Provizr, we understand your university retirement accounts, and we're always here to help ensure your portfolio is perfectly aligned with your life goals. Let's make sure your retirement is exactly what you planned!