What every new investor should know

Right from the day you get your first salary cheque, the biggest favour you can do yourself is to start saving and investing.

Before making any saving and investing decisions:

Decide what you’re saving for Find out more about savings and investment options and how they work.

Put together a plan on how to reach your financial goals.

Choose an investment or savings plan that will help you realise your financial goals.

Keep in mind:

Inflation, currently at around 6% per year, eats into your money. You need your investment to grow by at least that percentage or your money will be worth less over time.

The goal of investing is to make your money work for you by earning additional income or profit that you can use later, like to buy a house or retire.

Compound interest, over time, will make it possible for you to earn money from reinvested earnings.

There are a few decisions to make before you decide where to save or invest your money. It depends on the costs of the investment (bank costs/broker’s fees), how quickly you may need to access this money, whether it’s a long-term or short-term investment, and whether you can afford to take a risk or not.

There are four ways to invest:

Equities (shares and stocks) Bonds (you lend money to a company or government in return for a fixed amount of interest)

Property (you buy a property, or shares in a property company)

Cash (a fixed-term money deposit that earns interest).