WHY INVEST?
We all have goals that we want to achieve in life. Unfortunately, many of them come with a large and heavy price tag. On its own, the interest that you earn on your savings account is not usually enough to meet the cost of these long-term plans. Your cherished ambitions are likely to remain just that.
This is where investment comes in. Making the right investment now could help you turn your dreams into reality. You could pay off your mortgage, take early retirement, provide for your daughter’s wedding, support your children through university or college, take a career break and travel the world or buy a place in the sun. Whatever your dream, investing for it now should make it much more achievable.
How Long You Should Invest
Investing is not usually a ‘get rich quick’ scheme. You should think of it as a decision taken for a minimum of five years, and often for longer. Because of this, you need to think ahead, considering your circumstances not just now, but in the future. You also need to bear in mind that investment carries a varying degree of risk, and that the value of investments can go as well up.
Long-term investments aim to provide you with a ‘real’ return on your investment, one that beats the gradual erosion of the purchasing power of your money through inflation. This growth can take the form of regular income, long-term capital growth or a combination of the two.
You could also aim to choose a combination of savings (put aside where you can easily get at them in an emergency) and investments.