Oct 14, 2019  | Tags: Investment

Our Insights

If you’re wondering when to start investing, then you’ve already lost valuable time.

When it comes to investing, it’s never too early to get started. Don’t make the mistake of thinking that you need to have thousands saved up before you can begin.

You only need to have a few factors lined up before you’re ready to start investing.

The Best Age to Start Investing

First off, how old should you be to begin investing?

The concept of investing is associated with maturity. So it’s easy to think that you have to be an experienced older adult in order to make smart investment decisions.

Thanks to the sheer power of compound interest, however, investing is in many ways better the younger you are.

How so?

You have time on your side when you’re young. Setting up your investments early in life will give them plenty of time to mature and grow until you’re ready to retire and live off the passive income. 

So there’s no need to wait until you’re an established “adult” before you begin investing. Investing is something that can be started by virtually anyone at any age.

Signs You’re Ready to Start Investing

You’re good to start investing your money if:

- You have no debt (or you have healthy debts that are under control)

- You have enough cash tucked away in an emergency fund to support your family and yourself through at least three months of unemployment

- You have some spare cash left over at the end of each month

- You want to start financing a comfortable retirement

Do These Three Things Before You Start Investing

Clear away your debt.

Since having lots of high-interest debt is bad for investment efforts, prioritise paying off your debts before breaking into the market.

Set concrete financial goals.

You should always have a plan before you start investing. You need to determine in advance what kind of investments will suit your circumstances and when you can expect to see a return. Without an ultimate end goal, you may be tempted to sell out your investment before it has time to mature. Financial goals will help you stay on target and make healthy decisions with your money for your long-term benefit.

Establish and respect your limits.

Be realistic about how much you can afford to invest. Ideally, you want the money you initially invest to be money you won’t miss. Set aside for investment an amount of cash that you can afford to lose. This means you shouldn’t invest out of your savings or emergency fund. Invest only the cash that you can afford to spare. This doesn’t mean you should expect to lose money, but being cautious will help you avoid panicking and selling out prematurely if the investment market takes a downward turn. You also won’t feel the financial pinch as badly if you do suffer a loss.

Get advice

The most important thing you can do is get advice from experts. At CWM, we'll help you build a strategy in line with your goals and guide every step in your investment plan.There’s no time like right now to start investing in a secure financial future!

Talk to the team at Calder Wealth Management. Call us on (08) 8373 3333 to schedule your free initial appointment. 

Written by Ben Calder at Calder Wealth Management.