My 5 rules for long-term investing – Cassie, 27

Hi, I’m Cassie, I’m 27 years old, I own a doggy daycare business, and I’ve been investing for just over five years.
 
The legendary Warren Buffett famously has two rules for investing.
 
1. Never lose money.
2. Never forget rule number one.
 
Unfortunately, not all the investments I’ve made so far turned out to be winners.

Perhaps that’s why the Sage is worth seventy billion dollars. And I’m not!

However, time in the market is the most valuable thing to an investor, and I’m making good progress towards my long-term financial goals.

Here are the five rules I stick to.
 

 
 
Rule 1. Always use tax-efficient wrappers such as ISAs and pensions for your savings.
 
I use different accounts for different goals, to get the right balance of interest and investment returns and flexibility.
 
Rule 2. Reinvest.
 
The longer you put your money away for, the more you will earn.

I put aside a proportion of my salary each month, and always reinvest any money I earn, meaning my savings grow quicker.
 
Rule 3. Diversify.
 
A strong investment portfolio comprises a range of assets including shares, bonds, commodities and currencies, spread across numerous geographical areas.

My aim is to achieve steady long-term returns while reducing over-exposure to volatility of a particular investment type.
 
Rule 4. Set your timeframe.
 
This can indicate how much risk you can be exposed to.

I tend to accept a higher level of risk in investments I expect to keep for the long-term – perhaps five years plus – as it allows me to absorb any bumps in the road.
 
Rule 5. Watch costs.
 
I learned early on that management fees and commission can put a serious dent in your pot.

I shopped around to find a lower-cost provider, but still with a reasonable level of choice and support.
 
Learn much more here >