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How to start investing

Getting started with investing doesn't have to be challenging. Discover how you could take the first step.

Some things are hard to start. Old cars, or writing articles, for example. But it might not be as hard to start investing as you'd think. And you may not need as much money as you'd think either. 

If you've got your finances in shape and your head around the basics of investing, this simple guide shows you how to get started.

How much do you need to start investing?

As you may have figured out by now, the answer is: not much. You can start investing through HSBC's International Investment Centre with as little as £100 per month or a £1000 lump sum.

While a £100 investment is a nice gentle way to start, you may want to invest more than that if you have it. Because the more you contribute to your investment fund, the higher your potential earnings in the long run.

The key thing is to make sure you've got some money saved up in reserve before you start investing. We recommend having an emergency fund, held in a separate, easy-access account, to cover 6 months of expenses.

Remember, when you invest money, you're putting it at risk. Which means you could get back less than you invest. Your money could potentially grow too of course – that's why people do it – but there is that risk you could lose money. 

So an emergency fund can give you peace of mind that you'd have money available, without needing to dip into your investment fund, if you needed to cover an unexpected cost.

Can you access your money if you need to?

Big things in life can, and do, happen out of the blue. We understand that. With any HSBC investment, you have peace of mind knowing that you can access your money quickly if you need to – usually within 5 days of selling your funds or shares. However, this will impact the overall performance of your investment.

That's why we say that investing is for the long term – 5 years, at least. When you've time on your side, there's no need to panic if your investment falls in value at times. That's all part and parcel of investing. The longer you leave your money invested, the more time it has to grow and recover from setbacks.

How do you choose what to invest in?

As we've covered in investing for beginners, there's no shortage of options. But there's also no need to be overwhelmed. If you don't feel equipped to choose your own shares – and let's face it, most of us don't – there are lots of ready-made alternatives. 

For example, based on how long you can afford to leave your money invested and how much risk you're prepared to take, you may want to choose ready-made portfolio of investments.

If you chose this option, your money would be invested in funds made up of a wide range of investments, including shares and government bonds. Your investment would then be managed on your behalf. 

And if you're not sure how much risk is right for you, we can recommend a portfolio for you, through our online advice service.

Consider the costs

Whichever way you decide to invest, there will be costs.

Here are some of the more common types you'll come across:

  • ongoing charge: If you're investing in funds, this can be a useful comparison tool as it gives you a breakdown of the charges that are deducted directly from the fund, including the fund managers' annual management charge and other expenses

  • advice fee: This is the cost of receiving a personalised recommendation based on your circumstances. Of course, if you choose your own investments you won't pay any advice fee

Costs will be clearly signposted by the investment provider in the relevant product documents before you apply. It's important to read these carefully before you invest – and to factor the fees in, as they will impact your overall returns.

So, how do you actually start investing?

It's simple to start investing with HSBC. You just need to be an HSBC Expat Bank account customer, resident of an eligible country and over 18 years old. 

Just decide which of our 5 investing options suits you best:

Choose a ready-made HSBC portfolio

For a quick and easy way to start investing, you could choose one of our HSBC Global Strategy Portfolios. A series of 5 diversified funds, they are a one-stop investment that's managed on your behalf. All you need to do is choose your preferred level of risk and we'll take care of the rest. Start investing with a lump sum of £100.

Search our entire range of funds

If you like doing your own research, our International Investment Centre puts a wide range of funds at your fingertips. As well as multi-asset funds, this online fund platform features index trackers and single-asset funds. Start with a lump sum of £1000 or £100 per month.

Pick your own shares

If you know what individual shares you're interested in, our online sharedealing service could be for you. InvestDirect lets you research companies and set up share price alerts. You can even create a virtual portfolio so you can test your ideas before you invest. Minimum investment £1.

Get investment advice

If you're not sure where to start, we can give you personalised advice. Answer a series of questions and our Wealth Managers will advise whether investing is right for you and make recommendations customised to your needs. You can start investing with advice from as little as £250 per month – and you'll only pay a fee if you follow our advice so there's no obligation to invest.

Takeaway tips on how to start investing

  • Save an emergency fund of 6-months' worth of living costs before you invest.

  • Be prepared not to touch your investment for at least 5 years.

  • Think about starting small and setting up regular contributions.

  • Consider taking advice to help you decide what's right for you.

What next?

Disclaimer

Please remember that the value of investments, and any income received from them, can fall as well as rise, is not guaranteed and you may not get back the amount you invested. This could also happen as a result of changes in currency exchange rates, particularly where overseas securities are held or where investments are converted from one currency to another. We always recommend that any Investments held should be viewed as a medium to long-term investment, at least five years.

The HSBC Bank plc, Jersey Branch and the HSBC Group are not responsible for any loss, damage, liabilities or other consequences of any kind that you may incur or suffer as a result of, arising from or relating to your use of or reliance on this article. The contents of this article are subject to change without notice. HSBC Bank plc, Jersey Branch and the HSBC Group give no guarantee, representation or warranty as to the accuracy, timeliness or completeness of this article. 

This article is not investment advice or a recommendation nor is it intended to sell investments or services or solicit purchases or subscriptions for them. This article does not constitute an invitation, or a solicitation, to make an investment in any way to any person to whom it is unlawful. This article should not be used as the basis for any decision on taxation, estate, trusts or legacy planning. You should not use or rely on this article in making any investment decision. HSBC Bank plc, Jersey Branch and the HSBC Group are not responsible for such use or reliance by you. 

HSBC Bank plc, Jersey Branch has prepared this article based on publicly available information at the time of preparation from sources it believes to be reliable but it has not independently verified such information. Any opinions expressed are given in good faith but no liability is accepted for any direct or consequential loss arising from the use of this information. The opinion quoted is for information only and does not constitute investment advice or a recommendation to any reader to buy or sell investments.

Any market information shown refers to the past and should not be seen as an indication of future market performance. 

You should consult your professional advisor in your jurisdiction if you have any questions regarding the contents of this article.

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