Passive investments are great, right? You just throw your money into someone else’s project and let them handle it. Maybe it is a limited partnership or a syndication. The important part is that they will do all of the work while your investment grows, right? Unfortunately, that is wrong.
Passive investments do not mean that it will not require you to do anything. Although you have purposely invested in an investment that doesn’t require you to be the lead, you still have things you should be doing. For example, you Rockland buyers will be responsible for things such as calls to be made, checks to deposit, and making sure that your investments are going as they should.
Here are some things you should be doing.
These passive investments should have projections already laid out for you. Projections are the reason you invested in this particular investment. You can watch trends and changes for your investment, as well as making sure that the manager of the project keeps you up to date on current and future projections.
Do not be afraid to ask questions if results are not matching projections. The manager will have laid out the projections in the contract, and while no projection is a guarantee, if projections are not being met they should keep you updated.
One of the best ways to keep up to date on your investments is to review your monthly or quarterly reports. Make sure you completely understand these reports. When you review each report, it will not take you very long to understand where your investment stands. Usually you will want to read the summary followed by the month-over-month P&L statement. Make sure you understand these reports properly so that you can accurately gauge how healthy your investments are.
Make sure that you make time to attend any and all manager-hosted calls. These are the people that can really tell you about your investments and their knowledge is invaluable. These calls will give you current conditions as well as update you on what future projections are looking like.
It is too easy to have life get busy and to miss a month or even a quarter of keeping track of your investment. The longer you let this go, the more out of touch you will become with your investment. It is important to treat your investment like a job and to schedule times to update yourself on your investment. These scheduled times need to be on your calendar and you need to treat them as a priority.
The more time you invest into learning about your investment and how to track your investment in the beginning, the less time you have to spend updating yourself each month. If you can read and quickly understand the reports because you have invested time previously, you are more likely to keep a routine of checking on your investment. This all means that you need to ask questions when you don’t understand something and you need to invest more time in each new investment at the beginning of the contract.