Once you’ve worked your way through the Personal Finance Flowchart, right up to step 6, you should now be ready to develop an investment plan. Investing can help you to grow your wealth and work toward long-term goals.

Step 6: Invest and Save for other long term goals

If you have long term goals that you anticipate wanting to achieve before retirement, you should start to think about developing an investment plan.

For goals that have a shorter timeframe (eg < 3 years) you should still just use cash based investments and savings accounts. For the medium term (3-5 years) an investment portfolio with a more conservative mix of investments such as shares and bonds would be suitable. For longer term goals (7+ years), you can consider investing more aggressively, focusing on primarily share based investments.

Key Principles for Investing

1. Develop an investing plan — define your financial goals, risk tolerance and investment time frame.

2. Research different asset classes — understand the risks and returns, and how they can help you reach your financial goals. Find investments that fit your risk tolerance and investment time frame.

3. Diversify your investments — spread your money across and within asset classes to lower your portfolio’s risk.

4. Keep track of your investments — review them regularly and make sure you’re on track.

We highly recommend using the MoneySmart Investing Toolkit to build a personalised reading reference list that is relevant to your needs. wiki entries:

6 point investment development plan

How to choose investments


‘What is index investing?’



MoneySmart Article – Keeping Track of your Investments

MoneySmart Article – Investing and Tax

The ASX ETF investor course is an excellent series of videos that can help you learn more about ETF’s and how they work.