Issue 2016/06

You can save and invest for the future you want.

Most of us will agree that saving and investing are necessary if we want to have comfortable lives for ourselves and our loved ones. It is much easier to meet our financial goals if we start early.

To begin, you need to save – that is, you must pay yourself first (i.e. save first before you start spending). Spend less than what you earn.

After setting aside cash or emergency savings and getting basic health and life insurance policies, think about how you can invest your money, what goals and investment objectives you have and how much time you have before you need the money. Also consider your existing commitments, how much you can afford to invest and your appetite for risk.

You can start small. There are low cost investments that require less capital outlay. You can invest in bonds, shares, exchange traded funds (ETFs) or unit trusts. But read up before you invest. You need to be familiar with a range of investments so that you can build a diversified investment portfolio. Individual investments can go up or down in value, but over a sufficiently long time, a diversified portfolio of assets can give you a positive return better than leaving your money in the bank.