Why Start Early?

The earlier you start investing, the more time your money has to grow. This is thanks to the magic of compound interest, where you earn interest on your interest. It’s like planting a tree; the sooner you do it, the bigger it can grow.¹^, ²

Assess Your Financial Health

Before you dive into investing, it’s important to assess your financial health. Do you have high-interest debt? It’s usually a good idea to pay this off first. Also, make sure you have an emergency fund – typically three to six months’ worth of living expenses saved up.³

Set Your Goals

What are you investing for? A house? Retirement? Your child’s education? Having clear goals will help you determine how much you need to invest and what types of investments might be right for you.²

Understand Your Risk Tolerance

Investing always comes with some level of risk. Your risk tolerance – how much risk you’re willing to take on – will influence the types of investments you choose. Younger investors often have a higher risk tolerance because they have more time to recover from any losses.¹

Start Small

You don’t need a lot of money to start investing. Many platforms allow you to invest with small amounts of money. The important thing is to get started and make investing a habit.⁴

Diversify Your Investments

Don’t put all your eggs in one basket. Diversifying your investments can help reduce risk. This means spreading your investments across different asset classes, like stocks, bonds, and property.¹

Review and Adjust

Your investment needs will change over time. Regularly review your investments to ensure they’re still aligned with your goals. As you get older, you might want to shift to less risky investments.²

Seek Professional Advice

If you’re unsure where to start, seek advice from a financial adviser. They can help you create an investment plan that’s tailored to your needs.²

In Conclusion

The best time to start investing is now. By taking the time to understand your finances and setting clear goals, you can make informed decisions that will help your money grow over time. Remember, it’s not about timing the market; it’s about time in the market.¹^,²

(1) Gavin Shepherd and Sam Dunn, ‘Investing for beginners’ (Money Saving Expert, Investing in stocks for beginners: How to get started, published 04 October 2018, updated 28 March 2024) <https://www.moneysavingexpert.com/savings/investment-beginners> accessed 15 April 2024.

(2) MoneyHelper, ‘A beginner’s guide to investing’ (MoneyHelper, published 15 February 2024) <https://www.moneyhelper.org.uk/en/savings/investing/investing-beginners-guide> accessed 15 April 2024.

(3) Chelsea Brennan, ‘How to Start Investing: The Ultimate Beginner’s Guide (2024)’ (DollarSprout, published 14 January 2019, updated 23 January 2024) <https://dollarsprout.com/how-to-start-investing-for-beginners> accessed 15 April 2024.

(4) James Daley, ‘Our best investment platforms for beginners’ (Times Money Mentor, published 12 July 2023, updated 02 April 2024) <https://www.thetimes.co.uk/money-mentor/investing/investing-basics/best-investment-platforms-beginners> accessed 15 April 2024.