Setting up regular investments is a great way to automate your investing journey and take the day-to-day hassle out of it. It means you can get on with the more important things, all while your investments are building up in the background.
Our regular investment service lets you save as little as £25 a month into the investments of your choice. You set up it up by selecting the investments you want to buy and telling us how much to invest in them each month, then you’re all sorted for every month to come.
Just make sure you’ve enough cash in your account ready for your regular investment day (on or just after the 10th of the month). A good way to do this is by setting up a direct debit from your bank account. This should arrive in your AJ Bell account at the beginning of each month, with enough cash to cover your upcoming regular investments and charges.
Episode 13: How often should you invest?
In this episode, our experts debate a big question asked by many investors: how often should you invest? This depends on your individual circumstances and preferences.
Listen to our Investing Essentials podcastWhat are the benefits of regular investing?
A big benefit it not having to worry about remembering to invest each month. Often, we intend to fund our investment account but forget to do it, meaning that we invest in fits and starts. But with regular investing you will invest the same amount each month without having to remind yourself.
Another benefit is that you get a discounted dealing charge – meaning whatever investment you pick it will only cost you £1.50 to buy every month. You can pick from a huge range of regular investments, from popular shares, funds, investment trusts and ETFs. And considering buying shares, investment trusts and ETFs as a one-off can cost up to £5.00, regularly investing in them instead is a big saving!
But perhaps the biggest win of regular investing is avoiding trying to time the market. Lots of people might sit on the side-lines waiting to pinpoint when invest in the stock market. But history has shown it’s very hard to time the market accurately (even the professionals struggle to do this!). It means that often investors miss out on market gains because they’re waiting for the ideal time to invest. Remember the old investment adage “time in the market beats timing the market”.
Plus, data actually shows that drip-feeding money into investments regularly can, on average, benefit your returns over the long term – it’s a strategy known as ‘pound cost averaging’. Essentially it means that because you’re buying at different times, when markets may have risen or fallen, you’ll end up smoothing out the ups and downs of the market over time and lowering the risk of your portfolio.
Do I have to check on my regular investments?
One of the benefits of regular investing is that you can set it up and forget about it – but it’s important to check in on your investments every so often, to make sure they’re still working for you. Here’s a three-point checklist to keep you on track.
Are you investing enough?
If you set up regular investing a while ago, and you’ve had a pay rise during that time or just seen your disposable income increase, you might find that you could increase the amount you’re investing each month. Even a small increase can make a big difference over the long term. For example, an extra £50 a month invested* would increase your savings by almost £8,000 after 10 years. And after 20 years it would boost the pot by almost £21,000.
*Assumes growth of 5% a year, compounded annually.
Are your investments still right for you?
Our financial goals and time horizons change over time, which means our investments might need to change too. It’s a good idea to check in on the regular investments your money buys each month, and whether they’re still right for you. Perhaps you’re closer to your financial goal – whether that’s buying a house, retirement or something else – and lower risk investments might suit you better. Or maybe you originally invested in something a bit niche and now you want a broader investment.
Check out our tips on spring cleaning your investments to help you decide if your regular investments are still right for you. If you do need to change them, it’s a very simple process that takes a few clicks when you log into your AJ Bell account.
Are you investing in the right account?
You should check that you’re regularly investing in the best account for your needs. For instance, you might’ve originally set it up in your Dealing account but may benefit more from the tax efficiency of a Stocks and shares ISA. Equally, if you’re now saving for your first home or for retirement, a Lifetime ISA could make more sense. If you need to switch where you’re regularly investing, you’ll need to open your new account and get things set up there instead. Find out more details about each AJ Bell account and figure out which one is right for you.
Choose from a wide range of investments including shares, funds, investment trusts and ETFs.
Want to get into the investing habit? Our regular investing service lets you put as little as £25 into an investment of your choice, every month, for a discounted dealing charge of just £1.50.
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