Solution finder
I'm looking to Get my finances in order and and I have no idea where to start

What are my options when it comes to investing?

There is so much more to investing than stashing your money in a savings account. In fact, while cash is a very safe asset, it also delivers low returns.

What are my options when it comes to investing? What are the risks?

There is so much more to investing than stashing your money in a savings account. In fact, while cash is a very safe asset, it also delivers low returns.

The trick is to invest in a range of different investment markets. This lets you maximise returns while still working to a level of risk you feel comfortable with and allowing you to achieve your aims as an investor.

Different investment choices

Your Mortgage Choice financial adviser can help you decide the investments best suited to your needs.

To get started, let’s take a look at the main investment choices – and the pros and cons of each.

Main investment options

“Cash” includes savings accounts, cash management accounts and term deposits. All cash investments are very safe with a low risk of losing your money.

The downside is that returns on cash tend to be very low, and you won’t enjoy the benefits of capital growth – an increase in the value of your money over time.

Any interest you earn on cash investments is fully taxable, which further reduces the returns in your pocket. So it pays to hold some cash – but it potentially shouldn’t form the bulk of your portfolio.

Investors can choose to own residential property as well as commercial property. Both types of property can deliver ongoing rental income and long term capital growth.

An investment property is also very tax-friendly but the downside is high upfront costs including stamp duty. Your cashflow also needs to handle the ongoing costs of owning property, which can include maintenance, land tax, insurance and council rates.

Residential property is lower risk than commercial property but the market can, and does, still rise and fall over short term periods. Holding onto your property for the long term, at least seven years, may help to minimise this risk.

It’s relatively easy, and very affordable, to own a stake in some of Australia’s largest and most successful companies. It doesn’t take much cash to get started, and as a shareholder you’ll be entitled to receive regular dividends - a slice of the company’s annual profit. Along with dividend income, which can be very lightly taxed, you also have the potential to make profits on the sale of your shares, and these too are concessionally taxed.

Shares are volatile, meaning share values can rise and fall – sometimes very quickly, and selling during a market low can mean losing money on your shares. This highlights the importance of choosing quality shares and sticking to a long term plan to avoid in response to market dips.

By pooling your cash with that of other likeminded investors, managed funds provide access to a wide variety of investment markets.

Select from exchange traded funds, which have very low fees, or unlisted funds that can focus on a particular type of investment, or give you access to a broad range of asset markets from global shares to infrastructure assets.

Your Mortgage Choice Financial Adviser can recommend the mix of investments that suits your views on risk while helping you achieve your long term goals. 

Get started with investing

Many Australians hold investments but have you ever stopped to wonder if your portfolio is really working in your favour? Professional advice takes the guesswork out of investing.

This quick video gives you some insights into getting started with investing.

Talk to your local financial adviser today

Things can change quickly in the market.

Subscribe and stay informed with news and industry insights.