The Benefits of Investing Early
Now that I have paid off my debt, I have now turned my attention to my finances for the future – I can now use them for positive things that will help me build my wealth and set me up for the future.
I’ve been reading a lot of other blogs about early retirement. It’s fascinating, because over in the US it’s a big thing but over here…it’s not really spoken about. We all assume that we have to work until pension age, or that we will want to, when in fact we have no idea what may happen in the future or if we will even be able to work when we are older.
With everything that is going on in this country and the economy being an unknown state of affairs, I know that I do not want to rely on a pension only for my future – I want to have money saved that grows at a decent amount so that I become wealthier and wealthier each month.
So I don’t only want to build wealth for my pension-age self, but for before that also. In 10 years, 20 years or any time – I may want to get out of the ‘rat race’ and achieve financial independence. After reading so many (SO many!) blogs about early retirement, I can see that they all are investors.
Investing is something that again, is a topic that is not really discussed over here in the UK. Before I entered the personal finance blogging world, I thought the same as a lot of people do – investing is for people who are already rich, and is reserved for the men. But now that I have been doing my research, I know that anyone can start investing.
I think I’ll always have money in savings, but I really want to start investing my money too. There are definitely smart ways of going about it, and it depends on interest rates, the market etc.
A company that I have been looking at is Fidelity. As with all investments, it’s well known that there is a risk with your money, but we are living in times of tiny interest rates on savings accounts. Taking the risk can get you the best returns, and if it is a long term thing, investing is the way forward.
Fidelity offer Stocks and Shares ISAs to invest in but it is simple to transfer any cash ISA into it should you wish. The reason that this is appealing to me is because you can start with as little as £50 per month. I would like to invest more than that, but I think that’s a great amount to get started with – you don’t need thousands as I previously thought!
The thing that frustrates me the most when it comes to my finances, is that I didn’t start earlier with a positive financial journey. When I was a teenager, I spent all of my money on going out, clothes etc – the usual. I then started saving and had £3000 when I met my now-husband. We used that money for rent when we moved in together, but we had our daughter veryyyy quickly after being together, and I have had a super low income ever since.
If I had started investing and properly saving as soon as I started earning money, I would have so much now, and I would probably not have gotten into the financial problems that I did have.
I don’t think it’s ever too late to invest – but there’s no denying that the earlier you start, the better. Not just the earlier in life too – but earlier in the year.
I want to start saving in an ISA also, and it’s shown that if you start saving earlier in the tax year, rather than leaving it till the last day, any investment returns have longer to compound. When looking on Fidelity’s site, I found some statistics that they shared saying that if you invested in a fund that tracked the FTSE All-Share Index at the start of the financial year since 2007, it could now have over £8000 extra in it.
To find the extra cash to invest, I’m going to concentrate on earning extra money on the side to use, through these kind of methods:
Earning extra money has enabled me to pay off my debt quickly, and I want to continue earning more and more money to achieve my financial goals.
There are also ways that you can save money in order to get more money to put into your savings pot. I definitely recommend tracking your spending and creating a budget, so that you can then see where you can cut your expenses.
The food shopping is usually a place where most families find that they could cut back – and still manage to eat the same delicious food.
I recommend potentially switching your supermarket shop – I changed to Lidl and am always amazed at how little I pay for a trolley full of shopping (we spend on average £25 per week for 3 of us which includes meat every day). Could you spend that little on yours?
After creating a budget and writing down all of your expenses, have a go at reducing some other ones. Could you change energy suppliers which could save you hundreds of pounds per year? Just searching around for cheaper deals can be so worth it, and give you extra money for your future.
I’ve managed to reduce all of our bills by using comparison sites, and by reducing our usage of energy too.
As mentioned here, one of my big financial goals is to save for retirement. The ways that I am going to do this are saving and investing.
The reason that I’m going to both save and invest is just for my own feelings of security. After being in debt and in a bad place, I don’t want to go there again, and therefore don’t want to put all of my eggs in one basket. I think saving and investing in ISA’s are a great way to grow money over a long period of time.
Do you save in an ISA? Is this something that you will start doing in order to grow your money?
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