This is my definitive financial planning & investing for beginners guide. These 10 simple and effective steps are my best tips to get started TODAY!
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TIP NUMBER 1
I know that financial planning and investing for beginners can seem daunting, but the most important thing to do is to JUST START!
Begin by investing into low cost index tracker funds with any of the following:
You’ll already have done more financial planning than most people by doing just this!
All investing beginners in the UK must aim to maximise their utilise, and ideally maximise, their tax free ISA investment allowance.
Check out my recent video on how to build money by investing into an ISA here:
Broad market index tracker funds, when bought and held for the long term, have proven to be good providers of investment growth long term.
Remember that money invested in the stock market CAN GO UP AND DOWN.
Most investors lose money because they panic and withdraw when markets fall – avoid doing this and you will stand a better chance of investing and general financial planning success.
TIP NUMBER 2 in this financial planning & investing for beginners guide is to open a pension.
Contributions into personal pensions qualify you for tax relief, which means your payments in will have 25% added to them straight away.
You can invest in the same way as above when investing for the long term.
TIP NUMBER 3 is to build up an emergency fund.
This is essential in financial planning – you must always have a safety cushion.
Try to build up 3 months expenses in cash
TIP NUMBER 4 for financial planning and investing beginners is to GET THE RIGHT BANK ACCOUNT!
Avoid fees! Online banks like Starling and Monzo allow fee free withdrawals abroad.
Be savvy and open other accounts… Bank of Scotland Vantage give you high interest on certain balances, and Santander offer cash back rewards.
TIP NUMBER 5 is to open a credit card as soon as you’re able to.
My recent video, linked below, gives a complete run down of the benefits of credit cards and how to manage them effectively…
TIP NUMBER 6 if you want to be a boss at financial planning is to shop smart and use cash back rewards sites such as:
TIP NUMBER 7 is one of the MOST IMPORTANT for all beginners to financial planning and investing, and even a useful reminder to those more experiences…
LIVE BELOW YOUR MEANS!
Don’t spend everything that comes in… always pay yourself first by automating your monthly investments, but try to invest at the end of the month AS WELL AS at the start of the month by ensuring some money is left over.
AIM TO BUILD ASSETS THAT PRODUCE INCOME (like rent from properties you own and dividends from shares), then use this income to buy your luxuries.
TIP NUMBER 8 is equally important… know the true cost of what you are spending by calculating its future value.
If £20 was invested instead of wasted every month, over 20 years at an 8% compound return that would turn into over £11,500!
That is the true cost of wastage.
TIP NUMBER 9 is to get income protection insurance…
It is never cheaper than when you are younger so is best to buy it then. Having this insurance will ensure that your financial planning and investing can stay on track, even if you can’t work.
TIP NUMBER 10 is to invest in yourself!
There is no investment that will give you a greater return than this investment.
Warren Buffett has always said it is the best investment you will make – and he’s probably worth listening to!
So that is my financial planning & investing for beginners UK guide. JUST GET STARTED by following those 10 tips and you will be 1000 miles ahead of most people!
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*Although I am a qualified and authorised financial planner, the suggestions in this video should not be construed as direct financial advice. They are suggestions based on my own opinions and you are solely responsible for any and all decisions that you make.*
0:00 Start
0:56 Tip 1: JUST START Investing
4:17 Tip 2: Start a Pension
5:34 Tip 3: Build an Emergency Fund
6:14 Tip 4: Get The Right Bank Account
7:08 Tip 5: Get a Credit Card as Soon as Possible
8:00 Tip 6: Shop Smart = Get Cashback
8:38 Tip 7: Live Below Your Means
9:56 Tip 8: Know The REAL COST of What You Spend
10:37 Tip 9: Get Income Protection Insurance
12:07 Tip 10: Invest in YOURSELF
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