Financial Performance :: Monitor and Measure Your Results

Taking control of your financial future is a process. And as with any process, it is important to monitor your progress and measure the results. Doing so will help you understand how well you are doing and to determine if the financial strategies you are using are working.

A balance sheet provides a business with a snapshot view of its financial status. An income statement measures progress. You should do the same with your personal finances.

Monitoring progress
Preparing a personal balance sheet annually should be part of your financial management. You simply add up all your assets and subtract your liabilities to determine your net worth.

When preparing your personal balance sheet, separate your investment assets into stock, bond and cash categories. Understanding your personal "asset allocation" will help you organize your finances and your monitoring of them. Many financial institutions provide financial statement formats as part of loan applications. You can also find examples in almost any financial planning book.

It also makes sense to track changes from year to year to monitor your progress and determine if you are on track to reach your financial objectives. Here is a chart that provides a basic format you may want to consider using.

Category 2007 2008 2009 2010 2011
Fixed income investments$$$$$
Real estate$$$$$
Personal assets$$$$$
Other assets$$$$$
Total assets$$$$$
Less: Liabilities$$$$$
Net worth$$$$$

Measuring your results
The other step, and the one that is more difficult, is determining how well you are doing. Determining your "absolute results" or if your net worth has increased from year to year is easy. Determining your "relative results" or how well you are doing compared to the rest of the financial world is not easy. If your stock portfolio went up 15%, that is good if the overall market was only up 10%. However, if the market was up 23% during that same period, a return of 15% is not so good.

Measuring your results can be difficult in two ways. First, just doing the calculation can be complex, especially if you added or withdrew money from your portfolio during the year. It is also difficult to know what formula to use.

There are rate-of-return calculation tools in many computer software programs. If you are using a spreadsheet program, use the internal rate of return function to calculate the total return on your portfolio.

Second, you must have some basis of comparison to measure how well you did compared to a benchmark. If your portfolio is all stocks, you may want to compare your returns with those of an index like the S&P 500. If you portfolio is all bonds, you may want to use the return on long-term government bonds as a comparison.

You can also compare your returns with quoted mutual fund returns. But remember to compare with a fund that has a similar make-up of its portfolio. If you are a conservative investor with a portfolio of blue chip issues, don't compare your returns with an aggressive small company mutual fund.

Here is a chart of recent and long-term average returns for three classes of investments. You may find it useful for making comparisons. These returns take into account dividends, interest and changes in value. They also reflect an "internal rate of return" calculation that is akin to reinvesting your dividends and interest. The year of 2008 was a bad one for stocks with the S&P 500 index falling 38%.

Period S&P 500 Long-term
government bonds
treasury bills
2007 5.49% 9.88% 4.66%
2006 15.80% 1.19% 4.80%
2005 4.91% 7.81% 2.98%
2004 10.87% 8.51% 1.20%
2003 28.70% 1.45% 1.02%
2002 -22.10% 17.84% 1.65%
2001 -11.88% 3.70% 3.83%
2000 -9.11% 21.48% 5.89%
1999 21.04% -8.96% 4.68%
1998 28.58% 13.06% 4.86%
1997 33.36% 15.85% 5.26%
5 years
(03 to 07)
12.83% 5.70% 2.92%
10 years
(98 to 07)
5.91% 7.26% 3.54%
20 years
(88 to 07)
11.81% 9.27% 4.49%

Next steps
If your results meet your expectations, keep doing what you are doing. If your results don't measure up, you may want to take actions to improve them. This could include changing your stock selection process, urging your stockbroker to help you make better decisions, giving the responsibility to a professional investment advisor or choosing a different mutual fund.

Hot Topics

What is FAIRWINDS' Routing Number?


What are the 2013 IRA and HSA contribution limits?

Find out here.

When will I receive my 2012 5498 form?

Find out here.

What is a Routing Number?

FAIRWINDS' routing number (263181368) is used to identify FAIRWINDS Credit Union from other financial institutions and in no way identifies you or your accounts to others.

A routing transit number (RTN) is a nine digit bank code, used in the United States, to facilitate the sorting, bundling, and shipment of paper checks back to the drawer's (check writer's) account.

The RTN is also used by Federal Reserve Banks to process Fedwire funds transfers, and by the Automated Clearing House (ACH) to process direct deposits, bill payments, and other such automated transfers.

What can I do with my Relationship Rewards points?

Relationship Rewards provide you the opportunity to enjoy special member benefits including:

  • Buying down the interest rate on a loan.
  • Increasing your rate on a new CD.
  • Reducing service charges on additional products and services.
Learn more about our Relationship Rewards program.

How do I send or receive a wire?

To send a wire from FAIRWINDS, please provide the following:

  • Name, address and routing number of financial institution receiving the wire
  • Account number for the receiving account
  • Name and address of receiving account holder

There is a $20.00 service charge for an outgoing domestic wire from a personal account and a $25.00 service charge for an outgoing wire from a business account.

To receive a wire at the credit union, you will need to provide the following:

  • FAIRWINDS routing number (263-181-368)
  • Name of account holder
  • FAIRWINDS account number to receive the funds

There is a $10.00 service charge for an incoming domestic wire to a personal account and $15.00 service charge for an incoming wire to a business account.

*Please verify this information with the receiving financial institution as there may be an intermediary financial instititution involved.

When should I expect my 5498-ESA tax forms?

5498-ESA tax forms will be mailed by April 30th for all Coverdell Educational Savings Account owners who made contributions and/or rollovers into their ESA's in 2011.

5498 and 5498-SA tax forms will be mailed in mid-May for all Traditional, SEP, and Roth IRA owners and Health Savings Account owners who made contributions and/or rollovers into their IRA's and HSA's in 2011.

For questions regarding the 5498 forms please call Member Services at 407-277-5045 or visit your local branch.

When should I expect my tax forms?

FAIRWINDS mails 1099-INT and 1098 tax forms at the end of January. However, if you have e-Statements, these tax forms are available online right now!
Learn more here.

Members will only receive a 1099-INT form if the aggregate earnings amongst the accounts they are tax reported for (the primary owner) have earned at least $10 in interest.

These accounts include:
Savings, checking, money market, certificates of deposit, and US Bonds Redeemed, but do not include IRA accounts. If members have not earned at least $10 in interest, they will not receive a 1099-INT form.

Members will only receive a 1098 Mortgage Interest Statement if they paid $600 or more in interest on their mortgage.

FAIRWINDS mails 1099-R, 1099-Q, 1099-SA, and FMV/RMD statements to members by January 31st each year. We also mail 5498, 5498-SA, and 5498 ESA forms to members by the end of May.

Important information for all MasterCard® and VISA® credit and debit card holders.

You may have seen news stories recently about a potential data breach with MasterCard® and VISA® through a third-party payment processor. While there is no indication that any FAIRWINDS members have been impacted by this event, it is an opportunity to remind all consumers about the importance of being diligent, safeguarding your personal information and monitoring your accounts on a regular basis to minimize the effects of fraud.

Take the few extra steps to proactively protect your accounts. If you believe your credit or debit card information is at risk or unauthorized transactions have posted to your account, contact your financial institution immediately. In addition, you may want to consider looking into an identity theft alert program to keep you informed of activity on your accounts. There are many reputable programs available, including ID Secure. Click here to learn more.

There is an active texting scam occurring in the Central Florida area.

People are receiving a text at random stating their "card has been deactivated." This is a Scam!

Always remember, FAIRWINDS will never ask members to provide confidential information, such as debit or credit card numbers, PINs or Social Security numbers via email, text messages, direct mail or over the phone.

If you feel you are the victim of account fraud or identify theft, act immediately. This should help minimize the damage to your personal accounts and credit rating. Click here to learn more.

What are the 2013 IRA and HSA contribution limits?

Traditional and Roth IRA owners under age 50 may contribute up to $5,500 toward tax year 2013. A $1,000 catch up contribution may be added for Traditional and Roth IRA owners age 50 and over.

2013 SEP contribution limits have increased to a maximum of $51,000 or 25% of the employee's compensation, whichever is less.

HSA owners under age 55 with an individual HDHP (self coverage only) may contribute up to $3,250 toward tax year 2013. HSA owners under age 55 with a family HDHP may contribute up to $6,450 toward tax year 2013. A $1,000 catch up contribution may be added for HSA owners age 55 and over.

When will I receive my 2012 5498 form?

5498, 5498-SA, and 5498-ESA forms report IRA, HSA, and ESA contributions, rollovers, conversions, and fair market value (December 31st balance) information to the IRS and account owners. 5498 and 5498-SA forms are expected to be mailed by Saturday, May 18th.

Please contact Member Services at (407) 277-5045 or visit your local branch if you have questions about your form(s).

How can I make a prior year (2012) contribution to my IRA or HSA?

Eligible prior year (2012) IRA and HSA contributions may be made through the close of business on Monday, April 15th. The IRS requires signed documentation before contributions may be designated for a prior year.

Members can accomplish this by visiting a local branch during business hours or by submitting an e-Signed form through Retirement Central® and click Manage An Account on the left menu.