Shopping for new investments tends to be a much more appealing activity than carrying out a thorough overhaul all investments carry the same amount of risk your old ones. It’s all too tempting to skip straight to the former – enticed by dreams of the potential riches on offer –  instead of taking a proper step-by-step approach to reviewing your investments.

In fact, getting diverted by new investing stories and buying into them on an ad hoc basis is a very typical trap that investors fall into, says financial expert Jasons Hollands, of Bestinvest. People’s attention gets gripped by the latest thing – whether Russia is ‘cheap’ and a good buy right now, for instance – instead of focusing on their overall holdings and what they are trying to achieve with them, he says. What this means is over time you end up with a portfolio that is just a random selection of yesterday’s investment ideas rather than a portfolio that works towards a goal and that suits your risk approach,’ cautions Hollands. Clean funds guide: Is it time to put your dingy old funds through the wash? What should you know before buying a fund? How many funds should you invest in?

After this stern warning, some good news. You should carry out a full health check on your investments once a year, but only once a year – doing it more often can actually be bad for you, according to Hollands. You can overdo it, and risk falling into another trap, which is being tempted into constantly making small changes and racking up extra costs, he explains. If you have committed to being a long-term buy and hold investor, chopping and changing funds all the time also doesn’t give ideas time to bloom.

Hollands advises carrying out your overhaul at exactly the same time every year, to achieve continuity and build up a helpful performance record. Early in the New Year, or just ahead of using your investing Isa allowance, or just after the end of tax year are all popular times. Hollands says no particular time of year is better than any other, but once you’ve picked one that suits you then stick to it. So what is the best way to review your portfolio? Many people invest for more than one reason at time – you may be saving for a big family holiday or to replace your car in a couple of years, in addition to trying to put away as much as possible for retirement. But over time, one or more aspects of your personal circumstances might have changed, like your job situation or receiving an inheritance. Cockerill says it might seem an obvious exercise, but it’s still worth sitting down by yourself or with your partner to decide your current financial targets and the time horizons in which you hope to achieve them.

250,000 over a certain time period. This will be very helpful when you come to assess the performance of your existing portfolio and whether it is up to scratch. You look at the level of growth you need and have you achieved that growth rate over the past 12 months or over the past two to three years,’ says Cockerill. Jason Hollands of Bestinvest says it’s also important to think about the way you want to go about achieving your goals. For instance, do you want to gain a pot of capital that you can turn into income later, or are you looking for a mixture of growth and income now. He adds that knowing your likely time horizons is key to deciding on the right mix of investments.