Is self investing right for me?

The way we interact with our money has changed dramatically over the past few years. These days, it's very rare to have a local bank manager who knows you and your financial situation inside out. Rather, we keep track of our own finances online, manage our money through banking apps and weigh up potential investment options on comparison websites.

Self investing, therefore, is the next natural step in stay-at-home money management – and it's more straightforward than you might think, with plenty of tools, videos and guides to help get you started.

Investing your money in funds, for example through a stocks and shares ISA with AXA Self Investor, instead of keeping it in a savings account, can potentially deliver higher returns in the long run. However, it's important to remember that they come with risk of losing some or all of your money as their value can fall as well as rise unlike cash savings, and you could get back less than you originally invested. Here are some of the steps to consider when thinking about self investing.

Assessing your situation

Self investing can be an attractive option if you're looking to take greater control of your finances. Before you get started, though, it's important to take stock of your personal circumstances and attitude towards investing: are you comfortable taking risks with your money for potentially higher returns and do you have the capacity to deal with any losses? Do you have long-term investment goals? Are you happy making investment decisions without personal financial advice? If the answer is yes, then self investing could be the right route for you.

But if you're averse to taking any risk or can't afford to lose any money, you might be better off sticking to a savings account. AXA Self Investor offers a helpful risk profiler that will allow you to identify your attitude to risk in order to help you select the funds that could be suited to you.

Being realistic

With a minimum investment amount of £50 per month, or a lump sum of £500, self investing might not be as exclusive as you think. However, you may also want to consider the amount of time it will take to manage your money. You'll need to research funds, invest in them, keep an eye on how they're doing and regularly review your portfolio to ensure your funds are performing as you'd hoped they would. If you'd prefer something a little lower maintenance, you could consider a mixed asset portfolio that invests in a variety of funds across different asset groups – which will provide you with diversification without having to select and monitor the individual funds yourself.

Making a plan

There are lots of reasons why you might want to start investing, whether it's for a fixed, long-term goal – retirement, children's education or property – or just for a rainy day. The sort of financial goal you have will dictate the funds you invest in, as the risk profile of a fund may vary depending on the length of time you want to invest for and the underlying assets of the fund. To find out more about making a plan that works for you, visit the AXA Self Investor website.

Getting the most from your money

Choosing from the vast range of funds available can be a daunting prospect for those new to self investing, and a lot of people base their decisions on what friends and family do or information from a trusted online source. AXA's investment experts, Architas, have put together their top 100 funds, as well as ready-made funds that they manage and example portfolios to help get you started.

For more information on self investing in a stocks and shares ISA and working out whether it could be right for you, visit the AXA Self Investor site.

AXA Self Investor does not give advice based on personal circumstances. Using our service means you are responsible for deciding which investments are suitable for you. Personal advice is only available from a financial adviser – if you don't have one, you can find one at unbiased.co.uk.

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