Investment
Making your money work harder for you
Investing is putting your money to work to help you achieve your personal goals. It is like a lot of things in life – rewarding but not free of risk.
We all have different experiences and goals, so your decisions about investing may be different to those of your parents, children, workmates or friends and should be tailored for you.
Are you an investor?
Maybe you think of an investor as someone rich enough not to have to work, who just lives off the income from their investment portfolio. Maybe you see an investor as someone who trades shares every day. Portfolio owners and share traders certainly are investors. But you are probably an investor too.
An investor is someone who puts money (capital) into an investment product or an asset in the hope of increasing their capital or getting an income – or better still, doing both. That means just about everyone invests, even if it’s money in your bank account or your superannuation (super) fund. You may start thinking about investing because you’ve come into some money – from a redundancy or compensation payout, an inheritance or gift or a lottery win. Or you may have a specific goal – to build a deposit for a home, to take an overseas holiday or to help someone through a tough patch.
Are you ready to invest?
Either way, make sure you’re ready to invest by checking you have:
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Your debt under control
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enough cash for emergencies
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adequate insurance protection.
And then you need to ask yourself the following:
Why
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What are your reasons for investing?
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Is what you hope to achieve realistic?
When
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Are you ready to invest?
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What is your time frame for investing based on your goals?
Where
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Where will you invest?
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Have you considered current market conditions and your tolerance for risk?
What
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Do you understand what you are investing in and is it appropriate to your needs?
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Have you checked the terms and conditions of the investment and any fees or commissions you’ll pay?
Who
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Will you invest on your own or use an adviser?
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Who is selling this investment?
Don’t rush into investing on your own.
Think about what it would be like to potentially lose all of your money on a bad investment decision.
Make sure you’re clear about why you’re investing and only invest in products you understand.
When you look at the financial pages of the newspaper or a financial provider’s website, the choice of investments can be overwhelming. Many financial products have similar sounding but subtly different names. How do you know which one is right for you?
We are here to help guide you through the potential minefield of investment and provide you with facts, figures and advice on building your own investment portfolio.