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Your money, your future

There are many facets to the world of investing and many choices to make: different asset classes, tax implications, risk and return variables, domestic versus international markets, when to buy and when to sell… the list goes on.

Having a trusted partner such as your financial planner to help will enable most people to make some sound choices and put their hard-earned savings into some suitable investments.

Why be an investor at all?

Investing, by a simple definition, is a means of accelerating the rate at which we save money and grow a future asset base. One of the most compelling reasons to invest is to provide a future nest egg to draw from, so you don’t have to work the rest of your life. Through investing, you are getting your money to grow at an accelerated rate through the power of compound interest.

The basics of investing

Viewed from the investor’s standpoint, the investment process can be broken down into three fundamental elements.

  1. Setting goals

Some investments should be viewed as long term and are some suitable in the short term. The first step in your investment strategy is to think about your goals and roughly how long until you want to reach those goals. See here at 

  1. Risk and return

When considering your investment, it is important to understand that:

  • The value of your investment and its returns will vary over time
  • Assets with higher long-term return potential usually have higher levels of short-term risk
  • Returns are not always guaranteed and you may lose some of your money
  • Past performance and returns are not indicative of future returns or performance

All investors need to decide how much investment risk they’re prepared to tolerate (or that won’t keep them up at night). Your individual circumstances may affect the level of risk that you are willing to take and therefore, the potential of return on your investments. Factors that you and your Financial Planner need to consider include:

  • Your age and investment goals
  • How much time you have (your ‘investment timeframe’)
  • Your other assets
  • How much risk you’re comfortable with (or risk tolerance)

For example, let’s say you’re aged 40 and your goal is to save for your retirement at age 60. If you are comfortable with your investment experiencing some bad years as well as good, you might invest in a riskier but long-term higher-performing asset class such as shares, given that you have 20 years to ride out any volatility. See here at and 

  1. Choosing the right investments

It’s important to remember that the right investments for someone else might not be the right ones for you. Only after consulting with your financial planner and after they have assessed your individual circumstances and attitude to investing will you be ready to consider their recommendation on which investments to choose.

The main types of investment asset classes are listed below.

Investment type (asset class) General risk/return expectation
Cash (term deposits, savings accounts) Low risk, low return
Bonds and fixed interest Medium risk, medium return
Property Moderate to high risk and return
Shares (also called equities or stocks) High risk, high return

There are different ways of investing in the different asset classes and a myriad of investment products to choose. For example, you can invest in shares either by buying them directly or via a managed fund, where your money is pooled with other investors and used to buy a portfolio of shares, managed by a professional fund manager.

One way to spread some of the investment risk while still having growth assets in your portfolio is to diversify. This involves spreading your money across different asset classes and investment markets – and even across different fund managers within the same asset class.

An effective strategy to achieve diversification is by investing in a ‘multi-manager’ fund, which works on the principle that over time, several carefully chosen investment managers can generate better returns than any single fund manager.

Your financial planner will clearly explain all your options and prepare an investment strategy tailored specifically to you.

To get in contact with our Financial Planner feel free to contact us at 03 9848 5933 or fill out the contact us form here. 



Lindale Insurances Pty Ltd ATF Lindale Insurances Trust ABN 27 027 421 832 is a Franchisee of Fiducian Financial Services Pty Ltd, Level 4, 1 York Street, Sydney NSW 2000. AFSL 231103 ABN 46 094 765 134.

The information (including taxation) provided on this website is general in nature and does not consider your individual circumstances or needs. Do not act until you seek professional advice and consider a Product Disclosure Statement.

The views expressed in this publication are solely those of the author; they are not reflective or indicative of Fiducian. They cannot be reproduced in any form without the express written consent of the author.

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