When should you start investing? Seven potential key moments in your life

In theory, you can become an investor at any point in your life. In practice, however, it is more a case of seizing the momentum at just the right time. But when is the right time to start investing? Below, we've set out a few potential times in life that may be perfect for you.

1. You've already built up a significant buffer in savings

In this scenario, you'll invest with money you don't think you'll need in the next ten to fifteen years. That's because investments need enough time to pay off. A well-stocked savings account can help you bring your investment goals forward.

Make sure you always have an emergency fund you can access easily and use to plug the gap comfortably for three to six months. After all, financial setbacks can happen in the blink of an eye.

2. Invest in a worthwhile pension with your first pay cheque

If you've just been paid your very first pay cheque, you may well think it's okay to splash some cash. Things like buying new clothes, booking an all-inclusive trip, or throwing a big party for friends and family are all attractive options.

However, you could do something that most people in your situation might not, and look at how you could earn your first pay cheque several times over at a later date by investing. Those new to the job market usually have few financial obligations, so it could be the perfect time to look beyond standard (pension) savings accounts.

The sooner you start investing, the greater your potential return at the end of your journey, in part thanks to the effect of compound interest. It also gives you more time to become a true investment specialist, with all the added financial benefits that come with it. Your retirement may suddenly become even more attractive thanks to your first pay cheque.

This all becomes slightly more difficult if you suddenly have children, buy a house or take on other financial obligations along the way. If you're looking for a balance between saving and full-on investing, pension savings funds – where your savings are invested in shares and bonds – may be an option worth considering. The potential return depends on your chosen approach to investing. Yet this type of pension savings can provide you with an attractive annual tax break of up to 30% on the amount you've saved up.

3. From a one-off inheritance to a lifelong gift

It goes without saying that an inheritance or gift represents an excellent opportunity to find your way around the investment market with peace of mind. It also gives you the opportunity to invest a larger amount straight away and therefore increase your potential return.

Again, you should take the time to think carefully about how much you want to invest, and make sure you have enough savings in reserve.

4. Your first home and settling down

Branching out into investing and settling down don't have to be mutually exclusive. Quite the opposite, in fact. While it's true that expenses will go up, the same can be said of income. Suddenly, you go from one to two payslips that can be put to good use in the same household.

And it gets even better when both parties think it's important to make smart financial plans for the future. If you don't yet have a mortgage or children, investing is certainly something worth thinking about. It goes without saying that clear, written agreements must be put in place to avoid any discussions about finances in the future, too.

5. Baby on the way? It's not a dealbreaker

Having children is more of a challenge from a financial perspective, whichever way you look at it. This is especially the case when they're unable to stand on their own two feet when it comes to finances – and that takes a while. Nevertheless, the arrival of a new member of the family can also be a great time to start investing.

As an example, you could invest part of the child benefit you receive directly in investments that grow together with your children. In other words, turn the traditional savings account into a strong investment plan and let your children take full advantage of the potential returns several years down the line when they want to go to university and move into a student flat or rent their first home.

6. Does a higher salary equate to a nicer car or greater financial independence?

After several strong years at work, you may earn more than a decent salary. But what could you do with the next pay rise or bonus that is particularly attractive and gives you even more financial freedom?

Instead of finally buying an expensive bicycle or investing in a second home, you could also consider investing (some of) that money in interesting investments. This could well be the ideal time to throw yourself into the unique world of trading or, alternatively, have your assets actively managed by investment experts.

7. You decide to start your own business

After a long time spent working for someone else, you may feel it is time to branch out on your own and be your own boss. A detailed financial plan represents the foundations for your future adventures. A strong investment portfolio can help you achieve your goals, as you may be able to create an additional financial buffer that you can also put towards new investments in the long term.

Think, reflect and take action

If you have decided that you're ready to make the leap to investing, be sure to keep the following tips in mind.

Put everything into perspective. Investing doesn't make you rich quick. Any returns on investments are only banked over longer periods of at least five to ten years. Are you sure you won't need the money at short notice and can risk it dropping in value?

Investing means taking financial risks. Make sure you are well informed about the possible scenarios.

Read up on investing in advance and don't let yourself be dazzled by the hype. It's also worth listening to stories from experienced experts. The good news is that you're already doing this!

Pay off loans or debts with higher interest rates in full first. Otherwise, you run the risk of destroying the returns on your investments (or worse).

Are you aware of your investor profile? This is not only useful, but mandatory, information if you want to invest.

Which financial goals do you hope to achieve by investing? Draw up a clear plan of action, ideally with the help of a professional or experienced investors.

Last but not least: investing also involves knowing how to keep your emotions in check. Keeping a clear head is a must if you want to achieve your investment goals.

When should you start investing? Now, and with Keytrade Bank!

In addition to being a reliable online bank, Keytrade Bank has grown to offer a modern investment platform tailored to all sorts of different investors, no matter what stage of life they find themselves in. Take the time to find out which investment plan is right for you.

Which investment plan is right for you?