Investments

Artisan Financial Services provide investment and wealth creation advice.

Make your money work for your future

If you’d like your money to start working for you, it’s time to learn about investing. Everyone has different needs and circumstances but here are some basics to consider. Please speak to us on 08 9388 1404 before you start putting your money into any form of investment.

What are your goals?

Start by setting your investment goals. Since each investment will vary in its potential for risk and returns, you need to choose the right investments to help you achieve your goals:

• short-term goals—like saving to pay for a car or holiday in the next six months to two years
• medium-term goals—what you want to achieve in the next two to five years, like starting a business
• long-term goals—if your goal is more than five years away, like saving for a child’s education.

When it comes to investing, it’s important to keep several fundamental principles in mind.

1. Set your investment goals

Before you start investing, it helps to have an idea of why you want to invest, how long you’ll invest and your attitude to risk. There are many types of investments to choose from, so selecting one that will help you reach your particular goals is essential. Professional financial advice is always a good place to start.

2. Start early, invest regularly and reinvest the returns

The earlier you start investing, the more time your investments have to grow. And the more regularly you add to your investments, the quicker they can grow. Putting income or interest from an investment straight back in could make a difference to how quickly your wealth builds.

3. Diversify

People say “don’t put all your eggs in one basket” for good reason, especially when it comes to high-risk investments. Diversifying can help prevent loss during market downturns because different types of investments are less likely to be adversely affected by the same market developments. For example, if you have investments in property and shares, your share investments are unlikely to be adversely affected merely because the property market goes down.

4. Time in the market is more important than timing the market

Investment markets are constantly changing and it can be difficult to say a certain time is better for investing than another. By staying in the market for as long as possible, you have the potential to reap the benefit of long-term trends.

5. Use dollar-cost averaging

Dollar cost averaging is an investment strategy designed to reduce risk. It involves making many smaller investments over time (instead of all at once) so risk is spread throughout market cycles. For example, if you use dollar cost averaging you might invest $1,000 every week for 100 weeks rather than investing $100,000 in a single investment.

6. Consider a multi-manager approach

Multi-manager portfolios combine the investment management skills of a number of specialist investment managers to build diversified investments. The aim is to minimise risk, particularly in fluctuating market conditions, by spreading your investments across a range of management styles and expertise.