Where Should you Invest your Excess Cash?

First do a bit of introspection and assess your financial position. Specifically if you have debt, start paying more towards the higher interest debts such as loans and credit cards. Debt like this would normally carry a higher interest rate than your investments, meaning you are actually going backwards.

If debts are in order, look at your own capital needs. Do you feel your are investing enough towards retirement? Do you have adequate emergency funds? Are you saving for a goal like a holiday? Then start investing towards one of these specific goals.

If you are wary of short-term volatility in global markets in light of global issues like the invasion of the Ukraine, you should not be investing extra money in equities(shares). You should then rather be investing in interest earning assets like cash and bonds, which carry less risk and short-term volatility.

If you understand- and are comfortable with the idea that equities are a longer term investment and you will have to ride out the storm, than you can look for buying opportunities in equity markets.

Also align your portfolio to not invest in high risk geological areas around major global issues such as the invasion of the Ukraine.

The investment goals as previously mentioned, each has a specific investment horizon. Different asset classes also have specific investment horizons. These two variables should align to guarantee growth over the specific investment term of your chosen goals.

Longer term investments should hold more equities and shorter term investment should hold more cash.

Try and follow a proven track record rather than speculating on securities and instruments that you do not understand.

Go see an independent financial professional, there are many out there that are fee based and sell their time instead of products where they earn commissions. Do your homework on this professional and make sure he/she has the credentials and certification with governing bodies where you have recourse as the client.

*This only serves as factual information and not advice.

Ruvan J Grobler RFP™

Photo by Rafael Classen on Pexels

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