Think that all investors are suit-wearing business men, or all 55 years or older? Think again. These days, plenty of younger investors are looking to take control of their own financial future by making wise investments which will provide them with wealth in the long term.
If you’re just starting out in the investment world, here are a few general pointers to get you started:
Think about setting clear investment goals
“Make more money” is probably too vague. You need to have some clear goals set out so that you know what you’re aiming for. So whether you’d like to make enough for a deposit on a house or to pay off your University loan, having this goal in mind will help you make better decisions about where and how to invest.
Decide on what you’ll invest in
Will your plan be to invest in property, navigate the stock market, or put your money into a managed fund or term deposit? Different types of investments carry different amounts of risk, so decide how much you’re willing to stake, and what your existing investment knowledge or experience is. Real estate is generally considered to be a sound long term investment, but obviously costs a lot more initially than other types of investments, along with the fact that you’ll need a mortgage to get started.
Get some advice
Whether it’s from an older, investment-savvy relative, or a professional financial planner, it may be useful to get some trusted advice when you’re first starting out in the investing game, particularly if you haven’t had any experience managing money or investments before.
Learn your basics
It will pay off (literally) if you take some time initially to do some reading and get familiar with basic financial and investing terms. Do you know what the intrinsic value of a stock means, or what an early exit fee is? What about the kind of return on equity your investment will generate, or the meaning of a franked credit?
Don’t expect to see your investments grow overnight. Investing is usually a long term commitment and it can take a while before you start to see results, but be persistent, stay on top of things and it will pay off.
Get started now
It’s never too early to start investing! Believe it or not, even if it seems like there isn’t a lot of spare cash lying around to start investing with, young investors can start investing with as little as a few thousand dollars into something like a managed fund or a term deposit account.
So choose an investment strategy, start researching, set some goals, and be prepared to start making sound investment decisions to grow your future wealth.