The idea of investing often sets off confusion, overwhelm and fear of the unknown, especially amongst female millennials. Here’s the good news: the reality of investing is nowhere near as tricky as it might seem and the benefits can be far bigger than you expect. Here are my five reasons why you should start investing now!
Make your money work.
You show up every day and work for your money, so make your money work just as hard for you. Investing often requires a mindset shift in how you view money, and this is important not only for investing but for your attitude to money overall. The key to remember is that money is simply a tool and not an end goal. Think of money as a tool which you can use to create the lifestyle you want and make it work for you.
There’s risk in investing, but there’s also risk in not investing.
If you have any savings in a bank account, you’ll most likely be aware that they are earning little to no interest. In fact, when you account for inflation (or the purchasing value of money), the ‘real’ value of your money over time is decreasing. Savings accounts have fixed interest rates, however investing is uncertain and money invested is at risk, meaning that no returns are guaranteed. However over the long term, investing provides the potential for far greater returns on your money than any savings account.
You don’t need to be a millionaire.
One misconception about investing is that you need to have a load of cash in the bank to get started. The reality is that you can start investing with amounts as small as £50 (depending on the platform you choose to use) and set up a direct debit to ensure that you keep adding to your investment pot gradually. Before you know it, the money will be working behind the scenes for you without you having to do anything.
Investing is a long game.
Starting sooner rather than later is always a good idea when investing. As I mentioned above, the growth of investments should be looked at over an extended period of time, therefore it is important to make sure that you only invest money which you don’t need easy access to and can afford to invest for the long term. Remember, you can always increase the amount you invest later down the line.
Future proof your retirement.
With the rise in self employment and entrepreneurship, the safety of pensions which previous generations experienced is becoming a thing of the past. On top of this, as a nation we’re living longer and we need to take responsibility for how we will fund our later life. Investing from a young age provides the best opportunity for your money to grow and benefit from compound interest - the principle that when you invest, as well as earning interest on your investment, you also earn interest on the interest itself.
Written By Elena Austin-Williams @thisgirltalksmoney
*Please note this blog post does not constitute financial advice. For advice, please speak to an independent investment advisor.