How do you know when you’re ready to invest?

Are you ready to invest? Here are some questions that’ll help you to decide…

Are savvy savers now turning to investing in a bid to combat the effects of inflation and potentially see a better return from their hard-earned cash?

The stats speak volumes; HMRC figures*, cited by* the Guardian, revealed a 33% drop in the amounts being invested in cash ISAs during the 2016-17 tax year. In contrast, stocks and shares ISAs hit a record high of £22.3bn during 2016-17, an increase from the £21.1bn recorded the previous year.

Investing in a Stocks and Shares ISA

A Zurich Stocks and Shares ISA can help you to generate a potentially higher return on your investment, than a cash ISA for those medium- to long-term goals (typically longer than 5 years).

As with any form of investment, opening a Stocks and Shares ISA does involve risk, meaning that the value of your money could fall. But you can help to manage this by opting for a fund best suited to your risk appetite.

Wondering whether you’re truly ready to invest? Answer ‘yes’ to all of the following questions and you may very well be…

Do I have an emergency fund in place?

We all need a savings safety net – some quick-access cash if the washing machine packed in, or the car took an expensive trip to the garage. The Money Advice Service says* we should aim to save up three months’ worth of essential outgoings; so it’s recommended to have this fund in place before investing is considered.

Have I paid off my debts?

If your student loan still exists, you might want to put this in the ‘manageable debt’ pile – whereas you could consider clearing smaller debts with high interest rates before you invest. For instance, if you have a credit card, the interest charged is likely to be higher than interest earned if you kept your money in your savings account. So, in most cases, paying off the debt makes financial sense.

Do I have clear goals for the future?

As mentioned, if you want to see potential results from your investment, you’ll need to think long-term, with clearly-defined goals that will keep you focused and motivated to continue your investment journey.

So, what might your goals be? Perhaps you envisage yourself globetrotting in retirement, or maybe your wish is to upgrade to a bigger house in the country. You might hope to one day start a family, add to your family, or simply want to make sure you can support your kids financially when they grow up and fly the nest.

Am I being realistic?

As we’ve mentioned, higher potential returns mean greater risk with your cash. Though you have the option of choosing funds best suited to your capacity for risk, there’s still a chance you could lose some, or all, of your money.

If you’ve decided to go ahead, you need to work out how much money each month you’re willing to invest (and potentially risk). To work this out, ask yourself…

• How much risk am I comfortable taking, bearing in mind I could lose some or all of my cash?
• What level of risk do I need to take in order to achieve my financial goals?
• How much can I afford to lose without it impacting my lifestyle? Am I happy with not being able to access my money in the near future?

If you commit to your goals and are prepared for some market movement, you could find that you see your money working harder for you in the long-term.

Have I done my homework?

Thoroughly researching your options will help you to choose the investment that’s right for you. You could start by visiting our ‘Savings and investment beginners guide’, which contains lots of useful information to help you get up to speed.

So, now do you feel ready to invest? If the answer’s ‘yes,’ have a look at the Zurich Stocks and Shares ISA. With five funds to suit different risk profiles, Zurich’s Stocks and Shares ISA can help you plan for the financial future you want and you can apply online.

The Zurich Stocks and Shares ISA is provided by Sterling ISA Managers Limited, trading as Zurich.

Sterling ISA Managers Limited, authorised and regulated by the Financial Conduct Authority. Registered in England and Wales under company number 02395416. Registered Office: The Grange, Bishops Cleeve, Cheltenham, GL52 8XX.

*We’re not responsible for the content of other websites


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