Have a look at our top tips on what to think about when starting to invest.

1. Think about your investment goals

Be clear about what you’re investing for. Investing is generally most appropriate for medium and long-term goals (at least five years). If you want access to your money before that, you might want to think about saving instead. It is important to remember the value of investments can go down as well as up and you could get back less than you paid in.

2. How much can you afford to invest?

Before you start investing, first make sure that you can afford your essential living costs, as well as any debts. It’s also a good idea to make sure you have some savings separate from your investments to cover emergencies.

3. Think about your risk appetite

Have a think about how much risk you feel comfortable taking with your money. You should also consider your other financial commitments when deciding how much risk to take. If you don’t want to or can’t take any risk with your money, then investing may not be for you right now. Try our investment risk tool if you're unsure about your own attitude to risk.

4. How long do you want to invest for?

The longer your money is invested, the more opportunity it has to grow in value and reach your goal. Each year, not only will the money you invest potentially grow in value, you’ll also potentially get growth on any previous growth. This is commonly known as ‘compounding’ and, over longer time periods, it can make a significant difference to the value of your investments. It is important to note that investments might not grow and you could incur losses as well.

Read our blog post: What Einstein tells us – reinvest your income >

Remember, as with any investment, the value of your fund can go down as well as up, and may be worth less than you paid in.

5. Think about what you might get back

The final value of your investments will depend on three main factors - how much you pay in, how your investments perform and how long you’re invested for. The more you pay in, the more you might get back, however there could also be higher losses. Similarly, the longer you can keep your money invested, the more could get back at the end. Charges on your investments will also impact your returns.

Top tips for investing your money

Remember though, the value of investments can go down as well as up and you could get back less than you paid in.

6. Mix your investments up

Putting all your money in one type of investment can be a risky strategy. You can help reduce that risk by spreading your money across a mix of investment types and countries. Different investments are affected by different factors - economics, interest rates,  politics, conflicts, even weather events. What’s positive for one investment can be negative for another, meaning when one rises another may fall.

Read our blog post: The importance of diversification and correlation in investments >

7. Be tax efficient

There are a number of options available. For instance, you could improve your tax efficiency by putting your money into your pension or using up your annual ISA allowance.

Find out more about tax efficient savings and investments >

8. Review, review, review

Make time to regularly review your investments to check they’re on track to meet your goals.

Find out more about managing your investments >


The information contained here should not be regarded as financial advice. The right option for you will depend on individual circumstances.

Check funds

Find all the information you need about our funds

Performance

Prices

Factsheets

Charges

 

Keep up-to date with the latest investment news and expert opinion.

ACCOUNTS AND SERVICES

Explore our investment options for pensions and ISAs.

FUND NEWS AND UPDATES

Keep up-to date with the latest fund news and updates.

FAQS ON INVESTMENTS

See some of the most commonly asked questions about investments.

TAKE A LONG TERM VIEW

Find out why it pays to take a long term view when you’re investing.