Here Are 5 Tips From Self-Made Millionaires To Simplify Your Investment Portfolio

Becoming a millionaire is a dream for many Americans. Most self-made millionaires achieve this milestone by building their own businesses and investments through hard work, patience and discipline — but the work doesn’t stop there. Simplifying investment portfolios is also part of the journey and a way to continue to build wealth and further boost your bank account.

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Here are some tips from self-made millionaires on how to simplify your portfolio.

Wealthy people know the best money secrets. Learn how to copy them.

Keep It Simple

Gene Caballero, co-founder of GreenPal and a self-made millionaire, said he focuses on diversifying across broad sectors rather than complicating his portfolio with too many specific stocks or funds.

“By selecting a few well-chosen index funds or ETFs — exchange-traded funds — I can effectively cover the market, which reduces the need to manage numerous individual investments,” said Caballero.

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Consolidate Brokerages

Alissa Krasner Maizes, Esq., founder and registered investment advisor at Amplify My Wealth, said that as a self-made millionaire, she simplifies her investment portfolio by keeping her accounts under “one financial roof,” where they offer low-cost ETFs and mutual funds whenever possible.

“For example, former employer accounts and other investment accounts are at Vanguard, except my Health Savings Account with Fidelity — Vanguard does not offer HSAs,” she said. “Consolidating and prioritizing lower fees also enables me to keep more money.”

Ann Kaplan, MBA, Ph.D., founder of iFinance and television host at Ann Kaplan, echoed the sentiment, saying that having two or more brokerage accounts can become difficult to manage.

“Consolidating as many of your accounts as possible can simplify managing your investments,” she said. “You do not need to widely diversify your management; you can focus on diversifying what is in one portfolio. How do you decide? Consider features such as performance, track records, fees and underlying investments.”

Work With a Fiduciary

Another tip is to hire a fiduciary financial advisor who is legally obligated to act in your best interest — something GreenPal’s Caballero did.

“This professional has been crucial in streamlining my portfolio management, ensuring it aligns with my long-term financial goals and remains free of unnecessary complexity,” he said.

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Streamline Your Finances

Self-made millionaires have a unique approach to streamlining their affairs, according to self-made millionaire Ravi Moolchandani, AFP, principal financial advisor and principal director of Radiance Wealth.

“All their estate planning, taxes, investments and income are embedded in a strict culture, as they have gone through their own hard ways to create and protect their wealth,” he said.

Overall, this approach can translate into minimizing accounts, investing tax-effectively, investing with down-side protection and hiring financial advisors.

Count Your Holdings

Some self-made millionaires argued that too many holdings may be difficult to monitor.

“It is suggested that 25 to 30 holdings may be the maximum number of investments before requesting a fund manager,” said Kaplan. “That is the suggestion, but the good news is there are steps you can take to slim down your portfolio without negatively impacting its performance.”

In addition, Kaplan recommended looking carefully at any of your stocks that make up more than 5% of your overall portfolio.

“Should any of the stocks account for 10% of your portfolio, that could be considered a risk,” she said. On the other hand, if you think you’re well diversified and most of your stocks account for less than 5% of your portfolio, “you may be holding onto and managing a portfolio of immaterial investments — investments that take your time to oversee or that you don’t bother to oversee — and they become a drag on your portfolio,” she added.

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