“When is the best time to start investing?” is a question often asked. The simple answer to those who have not made an investment plan, is that they should make it a high priority, preferably starting today.
You may not realize it but anyone with a Superannuation Fund has an investment. In July. 2025 the contributions made on your behalf by your employer will be 12% of your salary. This is a substantial saving. You can also make personal contributions, but you should consider whether it is a good idea to have most of your investments in one entity and whether any rules regarding your superannuation may prevent you from early access if required. The big unknown is what changes the government may make to superannuation in the future.
According to Google:
To achieve a comfortable retirement at age 67, a person earning average wages in Australia would ideally need a superannuation balance of $595,000 for a single person and $690,000 for a couple.
According to ASFA:a single person can enjoy a ‘comfortable lifestyle’ on around $51,000 a year while a couple would need around $72,000 a year. The decision for you if whether you want to be more than ‘comfortable’. If so, you need to create an investment plan.
If your investment knowledge is limited, a good place to start is reading some books about the topic. Good Financial Reads, Financial Mappers Blog page, has a substantial list of recommendations. I think the last book Strong Money would be an excellent start.
The second source of investment you may not have considered is the equity in your home. A common strategy is to use all your investment savings to repay your home as quickly as possible. The reason is that the interest charged on your home loan is not tax deductible. In addition, the equity in your home can be used as security should you choose to borrow funds for your investments. In this situation, the most common investment is real estate. Borrowing to invest in shares may be considered ‘too risky’ for those with limited investment skills. When you retire, you may downsize, leaving you with money to invest.
It is generally accepted that any investment portfolio should be diversified with allocations to superannuation, real estate, shares, managed funds and fixed interest securities.
This is where Financial Mappers software can help you plan your investment future. Not only can you plan your investments, but the software also includes a financial literacy program so you can build the skills you need. In the Retirement Phase, you can create a layered drawdown of your investments and let you see how long your funds will last.
The video, Plan Construction – Statistics, Financial Targets, and Asset Allocation demonstrates how this can be achieved.
Glenis Phillips SF Fin – Designer of Financial Mappers
Disclaimer: Financial Mappers does not have an Australian Services License, does not offer financial planning advice, and does not recommend financial products.
