5 expert investing tips to build wealth today

In a world where dramatic market swings and economic uncertainty have become the norm, making smart investment decisions has never been more important. To build wealth confidently, it is important to understand the foundational steps to investing money wisely.

Ashburton Investments shares five expert-backed investing tips anyone can apply, whether you are getting started or looking to fine-tune your long-term strategy.

1. Start with a plan, and start young

It’s easy to get overwhelmed by investment options, but the most important first step is having a clear financial goal and starting as early as you can to support those goals, even if the investment is initially small. Are you saving for retirement, a home, a new venture, or your children’s education? Knowing your ‘why’ helps define your risk tolerance and investment time horizon.

As Albert Botha, Ashburton’s Head of Fixed Income, says, “90% of investment success comes from starting early, saving enough, and letting the markets work. For most people, at least 25% of their investment portfolios come from money they started investing between the ages of 25 and 30.”

2. Diversify to manage risk

Don’t put all your eggs in one basket. A diversified portfolio spreads risk across different asset classes – such as equities, bonds, property, and cash – as well as different local and offshore regions. This helps to cushion you against turmoil and fluctuations in any single market.

3. Look beyond South Africa’s borders

Offshore investing offers access to broader opportunities than just the local market, which takes up less than 1% of the total investment universe, and can act as a hedge against local currency and market risks. This is quite topical now, considering that the rand is close to R21,46 to the Euro this week. Consider balanced exposure to global equities or funds tailored to international markets to help you weather fluctuations that can affect South African investors.

4. Consistency beats timing the market

Ashburton’s Head of Intermediated Distribution, Steven Amey, advises: “Live for today, but don’t forget to plan for tomorrow. Start small and grow your wealth over time by leveraging a mathematical wonder: compound interest.”

Trying to ‘buy low, sell high’ rarely works for the average, untrained investor. A more effective strategy is to invest regularly, in small amounts, and stay the course through market ups and downs. “This is why our philosophy is that small things, done consistently over time, with great focus and dedication, can create significant results. We stand by that philosophy.”

5. Understand what you’re investing in

Ashburton’s Head of Credit, Santhuri Thaver, says: “One of the best financial investments is education, it pays long-term dividends that transcend market movements.”

Financial literacy is about empowering yourself to know a range of financial terminology and tactics that can help you weigh up your options for better personal financial management. Choose a financial literacy news source you can trust and make it a habit of tuning in every week or month to learn more about the funds, sectors, and trends you may want to invest in. Ask questions of people who understand finance, read fund factsheets on investment companies’ websites, and don’t be afraid to seek professional advice. Don’t put all your trust in Google, ChatGPT, forex platforms, or cryptocurrencies – think wider and more long-term. 

Your future self will thank you

As Ashburton’s Global Multi-Asset Investment Strategist, Jarred Sullivan, advises, “your future self will thank you for staying invested due to the power of compounding.” It can be intimidating to invest, especially if you don’t have a lot of spare savings, however, it is important to start somewhere, to start young, and to stay invested. Your older self will thank you for making a wise choice today to delay gratification in favour of building your long-term financial future.

PERSONAL FINANCE