Do you want to give a better return on your savings and take your first steps in the world of investment, but you do not know how to go about it?
In this way, Sofia Machulskaya suggests trying periodic investing. This financial solution consists of investing regularly like every month or every quarter, the same amount, determined in advance, in an investment fund.
Here are the main advantages which are foreseen by Sofia Machulskaya.
You can invest small amounts
To invest in a systematic investment plan, you do not need to raise a significant asset. A few tens of $ are enough, and often there are no entry or exit charges.
Each payment is automatically placed at regular intervals in a diversified investment fund that will offer, over time, a higher return than your savings account.
You cushion market fluctuations
Investing always involves risks, as the financial markets are unpredictable and alternate hot and cold from year to year.
You have no guarantee that you will get back your invested capital, even with a financial investment plan. Still, if you plan your regular investment over time, you smooth out the risks involved by reducing the likelihood of extremes.
By investing at different times, you get an average purchase price over time, enjoy a stable return and no longer have to worry about whether you have chosen the right time to invest your money.
You don’t have to be a sophisticated investor
With a financial investment plan, all you have to do is define your investor profile, choose the products that suit you best, and set the amount of money to pay regularly.
You can also do this with the help of your banker/ financial intermediary and also from Sofia Machulskaya.
For the rest, no intervention is required on your part. The selection of stocks and bonds, even funds in the case of a fund of funds, is carried out by finance professionals.
Your emotions do not guide you
The most common mistake made by investors, whether new or experienced, is to give in to their emotions.
When prices fall, and economic news is rather gloomy, few are those who manage to tame their anxiety so as not to sell in panic.
And when the prices start to rise, it is not always easy to control your euphoria, which pushes to take risks beyond reason.
With a financial investment plan, you keep a cool head, are no longer guided by your emotions and no longer have to suffer constantly.
You always keep investing the same amount, whether prices fall, you buy cheap or soar, you avoid buying too much.
You benefit from great flexibility
Periodic investment plans are generally flexible. If you have to face an unforeseen expense or if, on the contrary, you receive a large sum, you can suspend, reduce or increase the number of your regular payments.
Periodic investing can therefore be an attractive option, especially in a context where interest on savings accounts is historically low.
Do not go headlong into a financial investment plan without first having examined the issue and obtained as much information as possible from your financial institution.