Are you a first-time investor who’s wary about investing a large sum of your hard-earned money? Read on to find out how to make your $1,000 investment worth much more.
With rising inflation eroding the value of your savings, hoarding money in the bank is no longer enough to guarantee a comfortable retirement fund. Investing is one way to make the most of your idle cash and gain profits from it.
For someone new to the process or who can’t spare much for investing, it can be daunting to take the plunge. Maybank’s Financial Goal Simulator simplifies matters by helping you plan your financial goals and gain a better understanding of what you want from investing.
Remember, you do not always have to start big. Just $1,000 is all you need to embark on your investment journey, and here are three viable avenues.
Unit trusts
When buying into a Unit Trust, you own units in the fund. For most cases, the initial investment can be as low as $1,000 or $100 monthly through the Maybank’s Regular Subscription Plan with dollar cost averaging. The money of all investors is then pooled and professionally managed by a fund manager, who will make the buying and selling decisions.
Investing in Unit Trusts can be done via Maybank2u Online Banking. Through this option, you can rely on the fund manager to do the research and selection. The diversified nature of Unit Trusts can also help mitigate downside risks for your investments.
ETFs and REITs
Traded on the stock market, Exchange-Traded Funds (ETFs) and Real Estate Investment Trusts (REITs) both require a low minimum investment. Investments can be done via Maybank Securities trading services for both ETF and REITs.
ETFs are similar to Unit Trusts in that they can be used to help build a diverse portfolio. However, as they typically aim to track and replicate benchmark indices, ETFs are more passively managed.
Going the route of REITs allows you to build diversified exposure to real estate investments without the hassle of maintenance and upkeep. The fact that all REITs have to distribute 90 per cent of taxable income to their shareholders, including REIT investors, also makes REITs investing an option for generating steady income.
Bonds
Bonds are debt instruments, where you lend money for a period of time to a government or company issuing the bonds.
Examples of government bonds include Singapore Saving Bonds (SSBs) for which the minimum investment sum is set at $500. The SSBs are typically perceived to be more defensive than corporate debts and carry lower risk of you not being able to recoup your investment. They allow investors to enjoy returns that increase over time – and not incur penalties upon early redemption.
the bottom line:
Starting your investment journey may seem complex and daunting, but starting small and starting now are the first steps to securing your future.
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