Getting started is easy

We all have the potential to be successful investors. Sometimes the hardest thing to do is take that first step. Partnering with an expert can often help.

The first steps

Some people have the time and confidence to take those first steps by themselves. For others, it can be a good idea to seek professional advice before they begin investing. Either way, it’s important to only select investments after you have determined some personal goals and weighed up how you feel about risk.

It doesn’t have to take much to get started. You can begin investing directly into, say, shares, or into a managed investment (offering a range of investment assets including shares), with a lump sum of as little as, say, $1,000 - even less in some cases. You can also contribute regularly to steadily grow your investments and build a diversified portfolio.

Pay yourself first

If your budget isn’t quite working and you are struggling to set aside funds on a regular basis to grow some initial capital, there is an alternate strategy. 

It’s called ‘pay yourself first’. Instead of aiming to save whatever is left over after you have paid all your regular bills and expenses, consider setting aside a fixed percentage of your regular wage or salary as soon as you get paid. 

Set up an online funds transfer timed with each pay day so that this amount goes directly into a savings account. You might be surprised how quickly you can accumulate funds to start investing.

Do the groundwork

When you have funds to invest, be sure to do plenty of research so you understand the market in which you’ll be investing. You should also research the products you’ll use to invest in that market. For example, for a managed fund, that might mean reading the Product Disclosure Statement for the fund. For shares in a listed company, it might mean looking at the annual reports (among other things). The key point is, there is a wealth of information investors can, and should, use to help decide which investments to select. This information should also provide insights into the risks, costs and tax implications of the investment you are considering. Speaking to a financial adviser might be a good idea if you need help.

Having done your research, and formulated an investment strategy, getting started can be as easy as filling in a form to apply to purchase the investment and paying some initial capital. From here, you might decide to set up a direct debit to steadily add to your investment portfolio.

If you’re investing directly, there may be other requirements. For example, for directly held shares (where you do all the buying and selling yourself), you may need to open an account with a broker.

Investing regularly, regardless of market movements

One approach to investing over time is through a process known as ‘dollar cost averaging’. It simply means drip-feeding your capital into investments. 

This process involves deciding how much you want to invest on a regular basis – perhaps $100 each month or $500 each quarter. This approach allows you to continue to invest as markets rise and fall.

This approach means you may be less concerned about getting your timing right, that is, identifying the single best time to invest a lump sum. By continuing to invest when prices are falling, you’re able to buy more with the same total investment amount. Whilst this can magnify any advantage you get from subsequent price increases, any price increase is not guaranteed.

Next: Tips for choosing investments

We explain some of the things you might need to know to put together a portfolio of investments that reflect your goals, life stage and comfort with risk.

We offer a range of investment solutions to help you build, manage, or grow your own portfolio.

Learn how to develop personal goals over different time frames. This can help you choose the investments that are right for you.
A little higher along the risk spectrum than cash, fixed interest securities can potentially provide higher returns, and even possible capital gains.
All investments carry some level of risk. We explain how to help manage this risk so that you are able to build a portfolio you are comfortable with.