Just starting out? Keep these 5 tips in mind when you invest.

Investing is an essential step towards establishing a secure wealth portfolio. When you invest, you are giving yourself the opportunity to benefit from profitable returns and the appreciation of valuable assets.

The world of investing can be a complex and daunting one and it’s a wise idea to discuss your investment decisions with a reputable financial adviser.

If you’re just starting off, here are 5 useful investment tips:

1. Investing is not gambling

It is true that all investing involves a certain amount of risk, but trading stocks and buying shares without any product knowledge or industry expertise means taking unnecessary risks with your precious finances. That’s gambling. Investing requires putting aside funds, investigating the best options for your investment plan, and committing to a long-term goal. 

2. Educate yourself as much as possible

Just as much as investing is not the same as gambling, it is not a game of pure chance. Even if you have the help of a financial adviser, you need to educate yourself about the current economy, the markets, and various financial products. Take it one step at a time – read the financial pages, look at different financial blogs, and ask your financial adviser lots of questions. Teach yourself about investing and you will be better able to engage with your investment plan.

3. Lose the belief that investing is only for the already wealthy

Anyone with some extra money can be an investor. You may not have a large amount of money to invest every month but if you do have money to use in this direction, you can be an investor. Investigate appropriate investment products and seek professional advice to make sure that the products you do choose suit your financial plan and will help you to move forward financially. It’s never too early to start investing. 

4. Set goals and stick to the plan

You need to decide why you are investing and set a list of investment goals. This will help you decide which products to invest in, as well as determine your risk profile. Most investments are for the long-term so you shouldn’t invest ‘everyday’ or emergency fund money in your investments. To get the best out of your investments, they should have a long-term horizon and you should commit to staying the course and avoiding losses by pulling out of investments too early or at the wrong time.

5. When you invest, don’t make emotional decisions

If you are going to invest well, you need to spend time working out what kind of investor you are and how your attitude towards your money will influence your investment decisions. It’s important to avoid knee-jerk and emotional reactions to economic changes, for example. You need to create a long-term investment plan. This doesn’t mean you can’t change the plan but you need to do so in an informed and controlled manner. Your financial adviser can help you with this.

Need help starting your investment journey?

Talk to a reputable financial adviser about how best to manage your wealth for proper investing and a financially secure future.