Do I Need To Be Investing?

Should I Be Investing?

Investment can have many long term benefits for you and those around you, but there are things to consider before doing so. It’s super important to pay off any short term debt, have your finances in order and make sure you are financially stable, think about putting aside an emergency fund and consider the option of paying into a workplace pension. Investing in something has endless benefits including boosting your financial independence. Investments are a good idea because they are a way of maintaining your money’s value but remember cash investments can lose value rapidly depending on inflation.

If you’re thinking about investing into something then it’s important to do your research. Sometimes investing can be a bumpy ride, but can be super beneficial in the long run. Taking those first steps will feel amazing and your financial future is almost guaranteed to be secure. Before investing make sure that you are financially stable, most investments take medium to long term to show any benefits at all.

Debt Priorities

Before you invest we always recommend paying off any debt you currently have simply because short term debt interests tend to be high and are way more than any return rate you may receive on an investment. If you have any credit cards or payday loans, work on paying those off first. But should you still have debt make sure you make all payments on time and avoid any missed payments simply because you may encounter late payment charges and occur higher interest rates, defeating the object of any investment. Late and non-payments also reflect negatively on your credit file damaging your chance of gaining credit in future.

NEVER USE A CREDIT CARD TO BUY AN INVESTMENT, INTEREST RATES ARE ALMOST GUARANTEED TO BE HIGHER THAN THE INVESTMENT RETURN.

Emergency Cash Fund

Sometimes life is good and sometimes it’s bad, that’s just the way it is and we can’t change or predict the future. Things happen unexpectedly. We can all fall on hard times and there’s no telling when that may be whether it be being made redundant from a job, something to do with your health whatever it may be, it’s important to be prepared emotionally and financially. So before investing make sure you’re prepared for any bumps in the road should they occur.Having something put away for a rainy day often offers peace of mind.

Pension Contributions

Retirement may seem like a lifetime away but believe me it sure comes round quicker than you might like to think. Making regular contributions to a work or private pension soon accumulates and offers stability when the time to retire does come. If you’re of working age and are enrolled into a workplace pension it’s important to note that anything you pay in is not taxable and you can choose the amount you pay in each month. Pensions are an ideal long term investment, workplace pensions cannot be accessed by anyone until they reach the age of 55.

If you aren’t enrolled in a private pension it’s crucial that you do think about the future and how you will fund your lifestyle when retirement hits. If you’re paying into a private pension make sure to keep on top of your regular payments as missed payments could be costly to you in the future. Last but not least your pension payments should take priority over future investments.

Are You Ready to Invest?

• Are you financially stable?
• Are your finances in order?
• Are your current debts paid off?
• Do you have a rainy day fund?
• Are you paying into a pension?

If the answer is yes to all of the above questions then you could be ready to start your investment journey and The Lost Coin Financial Planning Ltd is here to help. We provide ethical investment advice and services to our clients in and around Bristol.

Categorised in: Investments

This post was written by duodigitaluk@gmail.com