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How do you know when to save and when to invest?

8 tips for saving and investing:

  • How much money do you need to get started?

  • When should you start?

Most of us are aware that investing your money means you’ll end up with more than if you keep it in your piggy bank. But it can be surprising to see the difference between saving and putting your money to work – by which we mean investing in even low-risk, low-return products.

Women can’t “afford” not to invest

Women in particular – if you consider wage inequality, a tendency to work part-time, and their longer life expectancy – can’t really “afford” not to invest.

Here’s an example:

If you put 10,000 francs into a savings account for 20 years, at an interest rate of 0.25%, you’ll end up with 10,512 francs. But if you invest the same amount at, for example, 4.0%, you’ll accumulate 21,911 francs over the same period. You can use this saving calculator (supplied by to calculate the results for all your possible plans, even monthly deposits. (Don’t forget to deduct the costs of the investment product from your results!)

Saving vs. investing

Saving is when you simply put money aside for a certain period. You might have a specific purpose in mind, like a trip or a big purchase. But with investing, you temporarily turn your money into stocks, bonds, gold, or real estate, with the aim of increasing the amount you own over the long term. Deciding which is the better approach depends on your personal goals and opportunities. It also depends on how much you’re willing to take risks – without at least some risk, you can’t get a return.

A representative study of 1,500 people in Switzerland, conducted by Migros Bank, showed that 92% of young people (aged 18 to 29) regularly put money aside, along with 93% of 30 to 55-year-olds. The same young people said they didn’t invest their money, as they weren’t familiar with alternatives to savings accounts (52%) and they believed they had too few assets (48%).

When is the right time to start investing?

A question from many women

Is it still worth starting at 40 or 50, or is it already too late?

It always pays to make your money work harder. Compound interest means that the earlier you start, the better. But it can still be worthwhile investing at any age.

For mothers and fathers...

it’s always a great idea to invest any money your children might have – as we say in the trade, children have a very long “investment horizon.” Despite special conditions and little or no fees, with interest rates being so low at the moment, there’s little point relying on a children’s saving account.

How much should I invest?

This amount depends on your income, your outgoings and personal situation, your goals – but also your willingness to take risks. One way to work out your investment target is to start with your current budget, then roughly define your goals: what do you want to have in one year? three years? five or more years? Then see approximately how much money you will need to invest to achieve that.

You could invest any amount that you won’t need for the next five years. Or you could make regular monthly investments in a fund savings plan or ETF savings plan, instead a basic savings account. This is also possible with small amounts. But check the fees for these funds before you get started, especially with ETFs. Depending on which online broker or bank is administering them, there may be additional costs to make a deposit, transaction (brokerage) costs for buying and selling , and even additional taxes to pay. It’s good to compare a few providers to see what’s available.

9 tips for investing


Plan for the long term:

make your investment horizon (the amount of time you’ll keep your money invested) at least five years. 10 or more would be even better. And think about what features are important to you: would prefer low risk investments, flexibility, or high yield?


Determine your risk profile:

are you conservative, balanced or willing to take risks? This is mostly down to your individual risk appetite and risk capacity. Once you know your risk profile, this will determine the composition of your portfolio, including how much should be equity investment.


Be broadly diversified:

spread your investments across a range of asset classes, markets and sectors. This reduces risk and increases the chance of returns.


Calculate the real return and weigh it against risk:

ask yourself what the return on your investment will be after you deduct costs, inflation and taxes. How much risk do you have to take on to get to that figure?


Stay disciplined:

don't panic and avoid herd behaviour. Looking at the past shows that equity markets (e.g. the SMI) always go up over long periods of time (see chart).


Don't wait for the right moment:

there is no right moment!


Single premium? Or staggered?

There are different opinions here - those who stagger their investments benefit from the average cost effect, but some studies say that say that single premiums could be better.


Understand what you’re investing in:

find out what the financial product is. Read the small print! And if you’re buying shares, look into the business sector you’re entering.


If possible, leave your dividends in your portfolio:

this will give you an even greater amount of compound interest.

Common questions of women

Women often ask us about savings and investments. Common questions are: whether you should invest if you have debt, or how much cash reserve is really useful in an emergency. The answer is that the exact figures are always very personal, but determining a few facts about your own finances means you can think realistically, which will help you to determine your own strategy.

If you're looking to start investing in the near future, our new course, Invest in a Sustainable Future, begins on March 22nd! Led by Olga Miler & Jessica Robinson, it's sure to be a fantastic resource to help you on your investing journey!

Invest in a Sustainable Future

This article has been produced in partnership with watson, a Swiss news platform. 

Here is the link to the original blog article in German.

Wieso es nie «zu spät» ist

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