Investing 101 – HOW TO START INVESTING: where to put your money, how much to invest and what to invest it in?

I receive a lot of questions about “how to start investing” and this month alone I’ve fielded quite a few, so, as a belated birthday present to myself I decided to get this all out into a simple blog.

Any tax rates and thresholds mentioned in this post will be correct as at the time of writing but tax is something that gets tinkered with all the time so this could get dated pretty quickly but using figures will help you understand how it all currently works in principle.

First things first, everything I share here is information not advice. Once you decide to actually start investing you would be well advised to:

a) do some further research yourself; and
b) speak to a fee-only all-of-market independent financial advisor.
Fee only means they don’t charge you a percentage of what you have to invest (that is, they charge a fixed fee) and all-of-market means they can offer products from a range of institutions..

Ideally, you should only invest money that you will not need for at least 5 years. This is because share market prices move up and down and if you need that money before five years is up, there is more chance that you might have to sell at a loss.

Investing is a long-term game, the longer the time you can wait, the higher the probability of being up. Over a 20 year period, the S&P500 has returned a positive return 100% of the time. While the future may turn out to be different, you are generally well advised to leave money invested as long as possible.

While my aim is to make this discussion as simple and as unintimidating as possible, at times it will feel really complex not because investing is hard but because we invest within the context of a very complicated and convoluted tax system. But you have to get to grips with our tax system to get ahead with investing…anyhow,…I’ll divide this into four parts, feel free to skip ahead to the part that you need:

- Part 1 is all about what sort of investment account to put your money in;
- Part 2 lays out what to think about when deciding which institution to invest your money through;
- Part 3 helps you think about how much to invest over time;
- Part 4 provides pointers regarding what you should invest in. Part 4 is very much based on how I choose to invest and this is the area where you may want to talk to more people about including your chosen IFA.

Feel free to jump to the part that is most relevant to you...
- Part 1 - 04:54
- Part 2 - 19:14
- Part 3 - 26:35
- Part 4 - 30:22

RESOURCES

Resources and all links mentioned in episode: https://www.katsonga.com/wealthblog/investing-101-how-to-start-investing-where-to-put-your-money-how-much-to-invest-and-what-to-invest-it-in

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