All those assets you have that are
sitting around your basement don't do you any good. After all, assets that are
poorly or under-utilized might as well not be assets at all. In order to make
the most of what you own, it’s essential to develop an asset management program
that incorporates several different techniques.
Know what you have
Start by keeping an in-depth
assessment of your current assets. This includes not only your financial
assets, but those in physical form as well. If you’ve lived in the same house
for a long time, you may have lost track of all the stuff you've accumulated
over the years. In the past, this meant consulting with an asset management
firm, and allowing professionals into your home and office to document all of
your belongings for a hefty fee. However, recently there has been a surge in
asset management applications for smartphones and tablets, which can allow an
individual to document possessions in case of any accidents or surprises. Having
a detailed and itemized list of all physical assets isn’t just a smart asset management technique in case
of an accident, but a good starting place and reminder for the rest of your
asset management strategies.
Assess your current risks
Any risks you take will be potentially
damaging to the future portfolio of your assets. However, there are many ways
to reduce your current risks. For example, if you live in a flood area,
installing shelves to keep any belongings off the basement floor can save
thousands in damage for the price of a few Ikea shelves. Diversifying your
portfolio, likewise, can save a great deal of money in the event that anything
should happen to a specific part of the market in which you’re heavily invested.
In the information age, any investment in markets is unstable at best, since
markets that are strong and booming one year may be suddenly obsolete the next.
Regardless of bubbles bursting, the potential safety of diversification can
vastly outweigh the risks of having your portfolio concentrated in a specific
area.
Streamline current operations
Once you’re familiar with your current
state of affairs, trim the fat. Quietly underperforming assets may not seem to
be much of a risk, but they aren’t doing you any good in that situation either.
Consider pulling out what you have tied up in smaller operations and combining
those investments into a single larger one. Similarly, go through the list of
your physical possessions and see which ones are actually assets that you
should hold on. Some might be costing you money simply by existing or are preventing
you from making improvements to your home or business because of the space they
take up.
Consider streamlining your assets both
digitally and physically, in order to make certain that you’re making the most
of every penny and every belonging you have. This can not only ease some of the
clutter and worry that most people have about their current investments, but
also give you a clear, firm starting point from which you can launch more
operations. Knowing where you’re starting from can give you a much more secure
idea about where to go next.