There is never a right time to talk about investment. Most of us will say ‘I have other things I have to cover first’ or ‘investment is just for a rich people. I am barely able to have any of salary left at the end of the month’. Sounds familiar? If the answer is a YES, take 5 minutes to read what I write below. These are simple things to remember, nothing savvy.
Priority and choice
Every single thing we do in our life are decided by our priority and choice. Therefore, if you are determined to start investing, actually it is not that hard to do. Let’s not talk about how much you are going to invest every month. I am talking about your determination to invest, every month regularly. It is a habit which will become a lifestyle if you put discipline into it.
First thing first
When you receive your salary transfer every month, first thing to do is to transfer part of it for your investment. So, investment first expenses later. This is the real example of practicing point #1 above about priority and choice. I suggest you create another separate account in another bank with no ATM card so you will have limited access to withdraw it.
How much?
This depends on how much you can commit each month. I suggest do not be too aggressive at first. It is much better you can keep certain stable amount coming each month into your investment account. Remember you try to build a habit and discipline and that includes the amount as well from month to month. My personal insight: aim for at least 25% of net income every month.
What to invest?
No definitive answer for this question. It all comes back to your investment goals, time horizon, and risk appetite. However, we are talking about investment here, not saving. So avoid putting the investment money into saving or time deposit that only give guaranteed rate of return. Choose products that has potential return higher than inflation. Investment is a way to let the money work for you, Saving and time deposits are instruments to keep your emergency cash.
Happy investing!
