Investment guide

The benefits of investing regularly

The value of investments can fall as well as rise, and you may not get back the full amount you invest. 

Why now?

If there’s anything positive to come out of the coronavirus outbreak, it might be that some of us are spending less than we used to. Unfortunately, for many of us, this comes with a drop in income.

But if you are still working from home, you could be saving on fares or petrol from your usual commute. You’re probably not indulging in that lovely, but expensive, shop-bought latte either.

And with gyms having been closed, maybe you’ve paused your membership payments? Cinema tickets? Meals out? Sunday brunch? It can all add up to a tidy sum. 

So if you don’t need that money, and think you can afford to, maybe now would be a good time to put this spare money to work by investing it?

Set a goal, then shoot for it

Holiday home?

Tuition fees?

Round-the-world trip?

Think about something you would really like to buy or do in five years’ time or more and make that your goal. Having a good reason to invest will keep you motivated and focussed on what you want to achieve.

Just bear in mind that when it comes to investing, nothing’s guaranteed, so don’t invest more money than you could afford to lose. It’s also important to invest for at least five years to give your money the chance to grow.

Investing regularly – the benefits

By investing what you can afford on a regular basis – and forgetting about it – those small amounts could soon turn into something worth having. Here are a few of the potential benefits of forming a regular investment habit.

  1. 01

    Even out the ups and downs

    The markets rise and fall all the time, so if you’re investing a lump sum and then the market experiences a fall, it could take a while before your money builds back up again.

    By investing regularly, you could benefit from highs and lows in the market – what they call ‘pound cost averaging’ – and this helps cut down the risk of investing when the market is high.

  2. 02

    Stay rational

    Investing regularly removes the worry of trying to decide when to invest or withdraw your money. Trying to time the market is difficult and is often driven by emotion. And it’s thought of as a riskier, short-term approach.

    Making a regular payment every month over the longer term, five years or more, means you invest whether the times are thought of as ‘good’ or ‘bad’.

  3. 03

    Invest what you don’t need

    You don’t always spend the same amount of money every month – sometimes you’ll have more of your pay left over than others. Investing regularly means you can squirrel any extra cash away and build your pot up quicker.

We can help

If you have a little extra money right now, this could be a great time to get into the habit of investing regularly. Why not make a start with NatWest Invest, where you can set up an ongoing monthly investment from £50.

Or, if you already invest regularly, maybe you can afford to put a little more away. It’s easy to change the amount you invest, and you can also top up your investment any time, day or night.

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Learn more about investments

Whether you’re an experienced investor or just finding out what investing is, we’ve got a range of articles to help you understand more about investing.

We regularly update our articles depending on what’s happening in the market so check back for future updates.

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