Invest in you: Take control of your finances during Financial Literacy Month

Invest in you: Take control of your finances during Financial Literacy Month

Top tips from Brooke Roberts, CEO and Co-Founder of Sharesies AU

April is Financial Literacy Month - a great opportunity to check in on your financial situation and set some goals. Wherever you are in your financial journey, every day is a chance to take control, build better skills and adopt strategies to help create the financial future you want.

At Sharesies, we believe investing is a key part of setting yourself up for the long term. We’re passionate about making it accessible– by providing education and demystifying the process so we can help to create financial empowerment for everyone, whether they have $5 or $5 million. 

For people looking to take charge of their personal finances this month and start investing for their future, here are five things that Director and Co-Founder of Sharesies AU Brooke Roberts* recommends focusing on to get started:

• Create a personal budget to get a handle on things
• Establish your interests and financial goals
• Make a plan and habits to help you execute it
• Set aside emergency funds for anything unexpected 
• Get started! Don’t be afraid to give new things a go, and learn along the way.

Create a budget overview

A great starting point is to take a good look at where your money is going. Investing isn’t a race to the finish, so it’s important to be realistic with how much you can invest. It will help keep you consistent, and motivated.

This doesn’t need to be overly complicated. Just take a look at your fixed outgoings (bills and loan repayments, groceries, and utilities), variables (transport and entertainment), as well as big-ticket expenses (a holiday, wedding, car), and map how much of your money is going towards these. 

This process should show you what money you have leftover to invest. There’s a common misconception that you need hundreds of dollars to start investing, but that isn’t true. Investing platforms make investing more accessible than ever. On the Sharesies platform you can buy shares or portions of shares from as little as 1 cent. This means you can get started with an amount you can afford, and scale from there. 

Think about your interests and goals where you want your money to go

It’s important you spend your money on what matters to you. This could be setting a goal and saving up for a car, or how you give back to your community, and support causes that matter to you.  

It also can factor into how you approach investing. At Sharesies, we believe that investors deserve control and choice over their investments. It’s a conscious decision that the Sharesies platform allows investors to choose how they invest.

There are two main ways to invest through the Sharesies platform. You can buy shares in specific companies, or invest in products like exchange-traded funds (ETFs). 

Investing in funds helps you diversify by spreading your money across lots of different things like shares in companies, bonds, property, or even savings accounts. While investing in companies gives you the chance to invest in the brands you know and love. You can sort and filter over 8,000 options on the Sharesies platform, and look for investments that align with your values and goals. Whether it’s a specific company that fits your criteria, or for a themed ETF. Many ETFs have themes like sustainability or the environment, and they’re made up of investments that align with that theme.

It’s also important to know whether your potential investment matches your appetite for risk and your broader goals. Your ‘time horizon’—which is the length of time you plan to invest your money for—can factor into your risk appetite. If you have a longer time horizon and a higher appetite for risk, you might decide to go with something that could be considered a higher risk investment. If you’re planning to invest for a shorter period and have less time to ride the ups and downs of the market, you may choose something lower-risk. At the end of the day, it’s all about what you’re comfortable with!

Keep it consistent and make it habitual

A habit is an action that is played out the same every time you do it. For example, you probably wash and fold your clothes the same way each week, and you probably like to eat dinner at a specific time each day. It can be really helpful to turn your money and investing goals into habits, investing a specific amount regularly rather than one offs when you have extra time or money.  For instance, you might set up a routine day and time that you sit down and go through and pay your bills. When you’re starting out investing, you might want to keep it as consistent as possible - the amount you invest, the day you invest on, and the time you take to place your investments.

There’s an investment strategy called dollar-cost averaging that speaks to this. Essentially, it’s based on investing the same amount on a regular basis, regardless of what the price is. It’s a common strategy used to invest consistently and average out the short-term ups and downs of the share market over time. 

In saying this, it’s also super important to check in on your investments and listen to your gut. If your investments aren’t on track, it might be a time to re-think your goals rather than continuing with a strategy that’s not working for you. Don’t be afraid of switching up your strategy.

Save up an emergency fund 

As part of your budget, factoring in unexpected expenses is a good way to prevent setbacks in your financial goals. How do you know if you need one? Well, if your car broke down, or you smashed your phone, would you have the money for repairs on hand? Or would you need to cash out some investments? If you need to dip into your investments, it may be worth setting up an emergency fund to provide some cash relief for that ‘rainy day’. 

Give it a go! 

We often hear that the best time to start investing was 10 years ago, and the second-best time is now. That can apply to all good money habits. If you feel ready to make some changes in your relationship with money and dive into the world of investing, there are heaps of resources to help you get started. You’ll learn loads along the way.

Ok, now for the legal bit

All investing involves risk. There is no guarantee you will make money, and no guarantee that you won’t lose the money you start with. Sharesies does not provide personalised advice or recommendations. Any information we provide is general only and current at the time written. Finally, you should consider seeking independent legal, financial, taxation or other advice when considering whether an investment is appropriate for your objectives, financial situation or needs.

*Brooke Roberts is a sub-authorised representative of Sanlam Private Wealth. Sharesies AU Pty Limited is a Corporate Authorised Representative of Sanlam Private Wealth  (AFSL no: 337927).