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You’ve Got Some Cash To Invest, Now What?

Picking the right investment vehicle can be tricky and we so often need to trust a complete stranger’s advice, don’t we? Finally we can see the wood for the trees, we have our head above water and we are actually able to look at saving some money. Then, we have the following questions to answer - Who do we get advice from and what type of investment do we look to put our money into? Both equally important questions which we will answer in this article.
  • Who Should You Consult When Looking To Invest Money?
An investment professional! That’s the right answer. If you have someone in your family who is trusted then you are lucky and they should be your port of call. Failing that, you might want to consider chatting to someone at your bank or search online for a certified financial planner (CFP). The worst thing you can do is try and navigate the investment landscape by yourself (especially if you have little to no experience in investment matters). Making the wrong decision could be financial suicide.
  • What Type Of Investment Should You Look At?
That really depends on what you want your money to do for you and your appetite for risk. Just like anything in life, your decision has a set of pros and cons. If you want to play it safe and invest your money in an interest bearing account, then your cash is just about guaranteed (unless the bank goes under), but you aren’t necessarily going to get the best return on your money. On the flipside you might want to consider an equity portfolio (the share market). That type of investment will generate you the best return over the long-term but can you stomach the ups and downs of the share market? If your investment lost 30% overnight would it keep you up at night?

Here are a set of questions you need to ask yourself before investing a cent. The answers to these questions will help you determine what type of investment you need to be in. Actually, these are exactly the type of questions an investment professional is going to ask you, before looking to make a recommendation. So, best you get thinking about them:
  • How long do I want to invest my money for?
  • How liquid does my investment need to be? (How quickly would you need access to your money)
  • How much risk am I prepared to take?
  • Do I need to draw an income from this investment? (it might be your pension pay-out)
  • Is this a lump sum contribution or a recurring premium investment – or both?
  • Who do you want to leave the money to if you pass away?
The answers to these questions are a good starting point. Once you know what you want to do, seek professional advice and get started. The sooner you start investing for your future, the better.

Thanks for taking the time to read this article.

The iHound